Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

MILFORD DOCKS BILL

Read the Third time and passed.

UNITED REFORMED CHURCH BILL [Lords]

Read the Third time and passed, with Amendments.

COVENTRY CORPORATION BILL [Lords]

FRIENDS OF THE CLERGY CORPORATION BILL [Lords]

Read a Second time and committed.

ULSTER (PETITION)

Captain Orr: I beg to ask leave to present a Petition on behalf of the women of Ulster.
The Petition sheweth:
That the Province of Ulster has grievously suffered from a campaign of murder, arson and bombings throughout the last four years: that our lives and homes have been greatly affected and that the vast majority of Ulster people are adamant in their determination to remain citizens of the United Kingdom.
Wherefore your Petitioners pray that hon. Members maintain and uphold the democratic right of the women of Ulster to remain British citizens; that the House take immediate measures to ensure peace with justice for everyman, woman and child in Northern Ireland and undertake the immediate restoration of democratic government in our Province.
And your Petitioners, as in duty bound, will ever humbly pray.
The Petition and its associated documents contain 83,000 signatures comprising women of all faiths and persuasions. They represent one-sixth of all the women of voting age in our Province. My colleagues, the Unionist Members representing constituencies in Northern Ireland

many of whose constituents are among the Petitioners, support the Petition.
I believe that the House will agree that the Petition is timely, and I pray that the plea it contains may be speedily heeded.

To lie upon the Table.

Oral Answers to Questions — NATIONAL FINANCE

Direct Taxation (Proportion of Income)

Mr. Hayhoe: asked the Chancellor of the Exchequer what percentage of income is taken in income tax from a man with a wife and two children under 11 years of age earning the present national average; and how this compares with the similar figure for each of the last 10 years.

The Chief Secretary to the Treasury (Mr. Patrick Jenkin): As the answer contains a number of figures, I will with permission publish it in the OFFICIAL REPORT.

Mr. Hayhoe: Will the Chief Secretary confirm that the slice taken in direct taxation rose steadily throughout the 1960s and must have contributed towards the pressures for inflationary wage demands? Will he confirm that the peak has passed, that on the latest figures the percentage taken in direct taxation is lower and that the rising trend has at last been reversed?

Mr. Jenkin: My hon. Friend is quite right. The figures show that the proportion of this family's income taken in tax increased from under 6 per cent. in 1965–66 to over 14 per cent. in 1970–71 and that, as a result of my right hon. Friend's cuts in income tax, the trend has been reversed.

Mr. Arthur Lewis: Will the Minister confirm that the poor, hard-pressed, underpaid, top civil servants and judges will still do very well even after paying tax on the extra £2,500 they are to receive?

Mr. Jenkin: Assuming the same family with an income all earned, a man on £20,000 will be paying £10,207.29 in tax this year.

Following is the information:

An estimate for 1972–73 is not available. The figures for each of the 10 previous years are:


Year



Tax as %of income


1962–63
…
…
…
4·1


1963–64
…
…
…
3·0


1964–65
…
…
…
4·5


1965–66
…
…
…
5·9


1966–67
…
…
…
6·5


1967–68
…
…
…
7·5


1968–69
…
…
…
10·8


1969–70
…
…
…
12·5


1970–71
…
…
…
14·2


1971–72
…
…
…
13·0

The above figures are based on average earnings at October each year and take account of family allowance in addition to average earnings and the corresponding "clawback", where appropriate.

Investment Income Surcharge

Mr. Hiley: asked the Chancellor of the Exchequer what would be the cost to the Exchequer in a full year of raising the exemption from the proposed investment income surcharge from £2,000 to £3,000, £4,000 and £5,000, respectively.

Mr. Patrick Jenkin: About £35 million, £55 million and £70 million.

Mr. Hiley: Does my hon. Friend agree that the taxpayers in this bracket have been hard workers and hard savers and have always been putters-in rather than takers-out, and that it is unfair that they should be discriminated against? If he is not prepared to help all those with savings, is he prepared to make concessions for retired people?

Mr. Jenkin: My hon. Friend knows that, as a result of the unification of income tax and surtax next year, the first £2,000 of investment income will be taxed at the earned income rate and will be below the point at which the surcharge starts, so that the people to whom my hon. Friend refers will find that they have secured a significant benefit in their tax liabilities next year.

Sir Harmar Nicholls: Is not the term "unearned income", upon which this is based, wrong, and is it not against the best interests of the country that people who save and invest should receive the impression that they are not working in the best interests of the country, and

should not the tax position reflect that to a greater extent?

Mr. Jenkin: My hon. Friend is absolutely right. As regards nomenclature, I thought I used the phrase "investment income"; the other words have not passed my lips since 18th June, 1970. If my hon. Friend studies table 18 in the Red Book he will see that there are considerable advantages to the people to whom he refers.

Value Added Tax

Mr. Sydney Chapman: asked the Chancellor of the Exchequer (1) what representations he has received about zero rating for the purposes of applying the value added tax the design and consultancy services within a construction organisation, and charging the full rate when the services are provided by independent professionals; and what replies he has sent;

(2) what representations he has received about the application of value added tax to the professional services allied to the construction industry; and what replies he has sent.

The Financial Secretary to the Treasury (Mr. Terence Higgins): My right hon. Friend has received representations on both these points from a number of associations and individuals. I met a delegation representing the professional associations concerned with the construction industry on 6th June, and told them that their views would be given full consideration.

Mr. Chapman: I am grateful to my hon. Friend for that reply. Is he aware that if the present proposals are implemented they will be illogical, onerous and unfair, since certain design services in the construction industry will be zero rated and independent firms will be VAT-ed? Will he look carefully into this matter as it is causing bitterness in the design profession?

Mr. Higgins: I understand my hon. Friend's point about the position of independent professionals in the exempt sector. That is a theoretical description of the situation, but there are many factors which influence companies in deciding whether to employ independent architects or surveyors. I do not think it can


be argued that VAT would be the decisive factor.

Mr. Maclennan: When does the Chancellor expect to complete his consideration of this question and to inform the House?

Mr. Higgins: At the appropriate time.

Gross Domestic Product (Growth)

Mr. Knox: asked the Chancellor of the Exchequer what is his latest estimate of the growth of gross domestic product.

The Chancellor of the Exchequer (Mr. Anthony Barber): The present indications are that we are on target and that the economy is growing at the rate forecast at the time of the Budget, namely 5 per cent. a year over the period referred to in the Budget Statement.

Mr. Knox: Will my right hon. Friend confirm that he intends to pursue his policy of economic growth as a matter of absolute priority? Will he further confirm that the decision last Friday to float the £, which I warmly welcome, is further confirmation of this intention?

Mr. Barber: The fact is that the prosperity of the British people ultimately depends on the rate of our economic growth. I think it is satisfactory that the economy is expanding at more than twice the rate it did from 1964 to 1970.

Mr. Marten: In view of the recent statement by Dr. Mansholt in favour of a zero growth rate for the European Community, could my right hon. Friend assure us that the British Government have no intention of falling in with Dr. Mansholt's curious ideas?

Mr. Barber: My hon. Friend must have misunderstood me. I have already expressed a view about the determination and intention of the British Government.

Purchase Tax Reductions

Mr. R. C. Mitchell: asked the Chancellor of the Exchequer what effects he estimates the reductions in purchase tax in the 1972 Budget have had on the cost of living.

Mr. Higgins: I would refer the hon. Member to my reply to the hon. Member for Manchester, Ardwick (Mr. Kaufman) on 27th March.—[Vol. 834, c. 22.]

Mr. Mitchell: The hon. Gentleman's reply, like that of his right hon. Friend in answer to the previous Question, was no reply at all. Is he aware that many of the reductions in purchase tax announced in the last Budget have not been passed on to the consumer? Has he seen the numerous Press reports indicating that articles on which purchase tax was reduced in the last Budget have increased substantially in price since the Budget?

Mr. Higgins: I gave the hon. Member for Manchester, Ardwick (Mr. Kaufman) a specific answer on this topic on 27th March. Purchase tax reductions in the Budget were mostly reflected immediately in prices in the shops. Although there were exceptions, they were relatively few.

Mr. Burden: Does my hon. Friend agree that it takes some little time for these changes to come through because, goods already in the shops having attracted purchase tax and this having been costed in the retail price, the remission of purchase tax takes place on forward buying by retailers?

Mr. Higgins: I understand my hon. Friend's point though, as I said, most of the cuts were passed on immediately. One of the advantages of VAT will be that the problem which my hon. Friend mentioned will be ameliorated. It is true that in regard to various articles the process takes some time to work through. Some of the articles which have been mentioned in this respect were based on cost-of-living figures for last year and were then related to the arguments for this year.

Inflation

Mr. Douglas: asked the Chancellor of the Exchequer if he will make a statement on the current rate of inflation.

Mr. Barber: Yes, Sir. Over the past year the rate of increase of prices has been almost halved.

Mr. Douglas: In view of that subjective answer, does the right hon. Gentleman not agree that his objective is objectionable in that it means that for those on fixed incomes, particularly old-age pensioners, any increase in pension is overtaken by inflationary pressures in the economy? Will he make a statement saying how he intends to protect them


from the hidden devaluation which is taking place at present?

Mr. Barber: The hon. Gentleman is quite right to say that it is pensioners and those on small fixed incomes who are the principal sufferers from inflation. That is why over the past year we have taken the various actions which we have taken. This has ensured in the past year that the retail price index for all items has increased by just over 6 per cent. compared with almost 10 per cent. a year ago.

Mr. Ridsdale: Is my right hon. Friend aware of the fact that what is disturbing is that 800,000 building workers have put in wage claims of 20 to 23 per cent.—[HON. MEMBERS: "Hear, hear."]—and that 2½ million engineering workers have wage claims of up to 40 per cent., and that these wage claims are causing old-age pensioners and others to suffer?

Mr. Barber: My hon. Friend is quite right, and I am sure it will be noted outside this House, if it is reported, that when my hon. Friend made his observations about those wage claims they were cheered by the Opposition.

Mr. Healey: Is the right hon. Gentleman aware that the value of average earnings has dropped by £200 since he took office under two years ago? In view of the fact that devaluation is bound to increase the cost of living, will he abandon those elements in Government policy which are calculated to increase the cost of living—namely, rents, food and the new VAT?

Mr. Barber: I can assure the right hon. Gentleman that real earnings have been going up at a considerable rate over the past year or two. I thought the right hon. Gentleman would be the first person to accept that. What is certain is that any increase in prices as a result of any change in the exchange rate will be not nearly as much as the increase in prices resulting from inflationary pay claims.

Money Supply

Mr. Bruce-Gardyne: asked the Chancellor of the Exchequer what was the increase in the money supply (M3) during

the financial year 1971–72, in percentage and in money terms, respectively; and how these figures compare with those for each of the previous five years.

Mr. Higgins: The money supply (M3) increased by £2,913 million—16 per cent.—in the financial year 1971–72. With permission, I will circulate figures for the previous five years in the OFFICIAL REPORT.

Mr. Bruce-Gardyne: On Friday my right hon. Friend the Chancellor of the Exchequer told the House that he did not wish the increase in money supply to add to inflationary pressures. In view of the fact that the effectiveness of monetary policy must grow from public knowledge of its objectives, can he say whether Mr. Sam Brittan was correct to say that my right hon. Friend intends the rate of increase in money supply to come down from the present dizzy heights of 23 per cent. to the slightly less exorbitant figure of 15 per cent. by the end of the current financial year?

Mr. Higgins: A restrictive monetary policy would be inappropriate in present circumstances, but we recognise that an excesively fast expansion in monetary supply could add to pressures at a later stage. Therefore, we have considered this point. The objectives remain as my right hon. Friend stated in his Budget: to ensure that adequate finance is available for the extra output which our policies will produce. The increase in Bank rate represents not a change in monetary policy but a move to prevent a faster expansion in the money supply.

Mr. Powell: When does my hon. Friend expect the increase in money supply in 1971–72 to be fully worked through in terms of prices?

Mr. Higgins: My right hon. Friend will be aware that there is a great deal of dispute over the leads and lags in this matter but, as I indicated, we believe that the policies which we are adopting are consistent with all our overall economic objectives. We do not believe that restrictive policies would be appropriate in present circumstances, but we recognise that an excessively fast expansion in monetary supply would add to the inflationary pressures at a later stage. We have therefore take appropriate action.

Following is the information:

Increase in Money Supply (M3)


Financial year


£ million
Per cent.


1966–67
…
…
429
3·3


1967–68
…
…
1,258
9·4


1968–69
…
…
1,077
7·3


1969–70
…
…
374
2·4


1970–71
…
…
2,031
12·6


Source: Financial Statistics.

£ Sterling (Purchasing Power)

Mr. Skinner: asked the Chancellor of the Exchequer what, on the basis of the General Index of Retail Prices, is the purchasing power of £ sterling, taking it as 100p on 18th June, 1970.

Mr. William Price: asked the Chancellor of the Exchequer by what percentage the value of the £ sterling has decreased since June, 1970.

Mr. Kaufman: asked the Chancellor of the Exchequer what, on the basis of the General Index of Retail Prices, is the purchasing power of the £ sterling now, taking it as 100p on 18th June, 1970.

Mr. Higgins: Taking the internal purchasing power of the £ sterling as 100p in mid-June, 1970, its value in mid-May, 1972 is estimated at 87½p. This estimate is based on changes in the Consumer Price Index between 1970 and 1971 adjusted by movements in the General Index of Retail Prices for the months at the beginning and end of the period. If the estimates were based solely on movements in the General Index of Retail Prices, the corresponding figure would be 86p.

Mr. Skinner: It does not matter what one does with figures. They all come out the same. Is not the hon. Gentleman aware that while the Chancellor of the Exchequer has been busy floating the £ on the foreign exchange market, at home the £ is rapidly sinking? Is he aware, further, that if it is right for City speculators to look after their six-and 12-months forward positions on the market, as they have been—causing the floating of the £, some would argue—it must also be right for ordinary wage earners to look after their 12-months forward positions in terms of wage increases? If the right hon. Gentleman is so concerned about old-age pensioners, let him bring forward the pension increase tomorrow.

Mr. Higgins: The crucial point which should be brought out is that the figures do not remain the same, contrary to what the hon. Gentleman suggests. Since June, 1971, the trend is very clear from the figures which have been given in answer to Questions which the hon. Gentleman has put constantly. They are 10·3, 10·1, 10·3, 9·9, 9·4, 9·2, 8·2, 8·1, 7·6, 6·3, and, in May, 6·1. While that is a matter about which we must not be complacent, it shows a trend in the right direction.

Mr. Price: Would the hon. Gentleman care to do the country a favour? Could he go a little further and forecast what the £ is likely to be worth in 12 months?

Mr. Higgins: The House knows that it is not normal to give forecasts of that kind.

Mr. Kaufman: Is the hon. Gentleman aware that the scandalous 14 per cent. cut in the value of the £ took place before last Friday's events? Will he say what additional reduction there will be in the purchasing value of the £ as a result of Barber's backdoor devaluation?

Mr. Higgins: As I say, it is not normal to give forecasts on prices. I have no doubt that in due course we shall consider what will happen in the future, and I have no doubt that the hon. Gentleman will put down a Question on the results, as he has done consistently.

Mr. McCrindle: In view of the fact that, during this period of reduction in the purchasing power of the £, the level of savings has risen substantially, would not it cast some light on our frequent consideration of replies to Questions by hon. Members opposite if both these statistics appeared simultaneously?

Mr. Higgins: My hon. Friend's point is of very great importance. We ought to look at the overall position of the economy. In that respect, the level of savings is of great importance.

Manufacturing Industry (Investment)

Mr. Duffy: asked the Chancellor of the Exchequer what financial incentives he now proposes to introduce to stimulate investment in manufacturing industry.

Mr. Patrick Jenkin: The economy is now growing fast, and rising demand,


coupled with the new national and regional incentives, will stimulate investment.

Mr. Duffy: Is the hon. Gentleman aware that according to the DTI's latest survey almost half the firms engaged in manufacturing industry are even more pessimistic about future investment than they were before the Budget, before the setting up of the Industrial Development Executive and before the publication of the Industry Bill? Is the hon. Gentleman aware, further, that this lack of confidence in the British economy, like the lack of confidence in international sterling, is the free enterprise market's assessment of the Chancellor's management of the British economy over the last two years?

Mr. Jenkin: It is fair to point out that the DTI survey is only one of several. I have in mind especially the CBI survey and the Financial Times survey of business opinion, which show a remarkable strengthening of investment intentions since the Budget measures and point to a substantial rise in investment in the year ahead. I agree with the hon. Gentleman to the extent that in so far as there is hesitation in investment, it reflects some doubts about the future. But let the hon. Gentleman be in no doubt that the anxieties arise because of the fear of inflation, and that by far the biggest single element in rising costs and prices is inflationary wage claims and settlements.

Mr. Douglas: Is the Government's figure for gross domestic fixed capital formation on target?

Mr. Jenkin: We are looking for a significant increase in the volume of investment this year, and we are confident that it will come.

Standard of Living

Mr. Dixon: asked the Chancellor of the Exchequer what has been the increase in the standard of living on the basis of real disposable income per head since June, 1970.

Mr. Barber: Between the second quarter of 1970 and the fourth quarter of 1971—the latest available quarter—the standard of living on the basis of real personal disposable income per head rose by 4 per cent.

Mr. Dixon: Does my right hon. Friend agree that that is an annual rate of about 2·7 per cent., representing the increase in the standard of living since the last election, and that that figure invalidates the implication in the supplementary question addressed to my right hon. Friend by the right hon. Member for Leeds, East (Mr. Healey) under whose Government, on a similar basis, the standard of living was increasing at about 1·3 per cent.?

Mr. Barber: With respect, my hon. Friend is doing an injustice to the right hon. Member for Leeds, East (Mr. Healey). Between 1964 and 1970 the standard of living of the British people on the same basis rose at an annual rate not of 1·3 per cent. but of 1·5 per cent. My hon. Friend is right in saying that for the period which I quoted, the annual equivalent rate is 2·7 per cent.; in other words, that our standard of living has improved at almost twice the rate under this Government's policies of expansion and tax cuts that it did under the Labour Government's policies of restriction and tax increases.

Mr. Joel Barnett: Is it not a fact that the floating of the £ is a massive vote of no confidence both at home and abroad in what the right hon. Gentleman's inflationary policies have done? Despite all this, will the right hon. Gentleman persist in telling us that it is all a great victory? Does not he intend to change his policies in any way?

Mr. Barber: I made it quite clear in my statement about these matters on Friday that one of the principal reasons which led to the troubles a week or so ago and the action which I felt it right to take in the national interest was the fear of inflation. Certainly that is true.

Mr. Evelyn King: Amid the welter of figures which we have had today, is it not a fact that my right hon. Friend's announcement of a 4 per cent. rise in the standard of living is almost the only one worth hearing? Will my right hon. Friend publicise it as widely as possible?

Mr. Barber: The truth is that we are all—right hon. and hon. Members opposite and my right hon. and hon. Friends—in business together with the same objective of improving the standard of


living of the British people. Therefore this is an extremely relevant figure.

Mr. Bob Brown: Will the right hon. Gentleman accept that whether the standard of living, on the basis of real disposable income, has increased by 2·7 per cent. or by 1·5 per cent. is completely irrelevant? What is important is the dispersal of the wealth of the nation, out of which those at the lower end of the scale have been coming badly whereas those at the top have received a tremendous increase?

Mr. Barber: If one thinks about real earnings, average earnings during the past year have increased by 5 per cent. after allowing for the increase in the cost of living. The hon. Gentleman is quite right to say that one of the problems about improving the position of the lower paid, as we have found repeatedly, is that it seems to be impossible in many cases to improve the position of the lower paid without the trade unions concerned insisting that that improvement should be reflected all the way up through the differentials. This is one of the major problems.

Mr. Healey: But if the right hon. Gentleman is concerned—I believe that he is right to be concerned—about the need to compress differentials, how on earth can he justify giving people on £20,000 a year an increase of 18 per cent.? Should not the Government start there if they want to influence the unions' attitudes on this matter?

Mr. Barber: I can assure the right hon. Gentleman that if the average level of wage claims were anywhere near the average annual rate of increase involved in those increases, we should be doing very much better.

Regional Employment Premium

Mr. John Smith: asked the Chancellor of the Exchequer if he will make a further statement on the future of the regional employment premium.

Mr. Higgins: I would refer the hon. Member to my hon. Friend the Minister of State's reply to the hon. Member for Dunbartonshire, West (Mr. Ian Campbell) on this subject on 20th June.—[Vol. 839, c. 59.]

Mr. Smith: Is the hon. Gentleman not aware that total confusion reigns as to what is to be the future of the regional employment premium? In 1970, in his Budget Statement, the Chancellor said that it was to disappear in 1974. That was revised in 1972 to the statement that it would be phased out after 1974. Bearing in mind the fact that the REP is worth £100 million a year to regional development and also the need for some constancy in regional development intentions, is it not high time that the Government made up their minds what will happen in 1974, so that industry in the regions knows where it stands?

Mr. Higgins: I do not agree that there is confusion over this matter or that the timing of the phasing out is having an effect on investment. The Government's view remains the same as that in my right hon. Friend's statement in his Budget speech.

£ Sterling (Exchange Rate)

Mr. Cronin: asked the Chancellor of the Exchequer what consideration he has given to the future exchange rate of the £ sterling.

Mr. Barber: I would refer the hon. Member to the statement I made on 23rd June.—[Vol. 839, c. 877–87.]

Mr. Cronin: Is not the sudden devaluation of the £, precipitated by runaway inflation, an indication of the complete bankruptcy of the Government's economic programme and the total falsity of the Prime Minister's election promises? Would the right hon. Gentleman remember that, if he intends to ask the unions to bale him out of this situation by way of restraint on wage claims, the first thing that he must do is reverse the Government's policies, which have been unrestrainedly partisan and provocative? Finally, would the right hon. Gentleman reassure us that he will take steps to protect the low income groups in this devaluation?

Mr. Barber: In answer to an earlier Question, I explained the position of the low income groups. If I may refer to those people on small incomes for whom the Government have a special responsibility, it is worth noting that the purchasing power of the retirement pension is


almost 5 per cent. higher than it was in June, 1970. As the hon. Gentleman knows, pensions are being raised by a further 12½ per cent. in October. But the hon. Gentleman is quite right to point out—this was the implication behind his question—that our first priority is inflation.

Sir Robin Turton: I congratulate my right hon. Friend on the very wise and timely decision that he took last Friday, but will not the success of his policy depend on his ability to contain the increase in money supply in the next few months?

Mr. Barber: It is certainly true that the rate of increase in money supply is a most important factor, and one which I have very much in mind.

Mr. McBride: Since the right hon. Gentleman refers to the lower income groups, has he failed to realise that the persons on the lowest disposable income and the lowest standard of living, who are most likely to be most heavily affected by his creeping devaluation proposals, are the retirement pensioners? Will he not now, in decency, bring in supplementary pensions Estimates to increase at once the retirement pension?

Mr. Barber: I have explained that the purchasing power of the retirement pension is almost 5 per cent. higher than it was when we came into office. As for the future, I think that the whole House was very pleased that the Government acceded to the request, which has been made repeatedly for 20 years or so, that there should be a review of pensions every year.

Mr. Healey: When the Chancellor met his colleagues among the Common Market Finance Ministers yesterday, did he raise with them the point that the devaluation of the £ means an increase in prices not only of imported food next year but of British food under the common agricultural policy? Did he insist to them that it is intolerable for the British Parliament and people to accept this additional impost?

Mr. Barber: I have already said in answer to the right hon. Gentleman or one of his hon. Friends that any effect on prices of the action that we have taken will certainly be very much less

than the effect on prices of excessive pay claims. If the right hon. Gentleman wishes to ask me about my discussions in Luxembourg yesterday, I can say to him that the very first point made to me yesterday in Luxembourg by the first Finance Minister I met concerned the right hon. Gentleman's remarks.

Mr. Tapsell: Has my right hon. Friend noticed that hon. Members opposite, just now echoed by the right hon. Member for Leeds, East (Mr. Healey), repeatedly use the word "devaluation" to describe a floating operation of the £ which has not yet been properly tested in the foreign exchange markets of the world? Is this not further evidence of their attempts to talk down sterling?

Mr. Roy Jenkins: Following that question, and reverting to the Question on the Paper, does the Chancellor endeavour to pretend, as he did on Friday and over the weekend, that this is not a devaluation? Has he any intention of returning or any belief that we can return to a rate of 2·60 dollars—[An HON. MEMBER: "What about 2·40?"] No, 2·60 is not equivalent to 2·40, because the dollar has changed and we are lower today against the weighted average of world currencies than we were in December. This is a very important point—[HON. MEMBERS: "Who repaid the debt?"] Hon. Members should not get so excited. Will the Chancellor give us any indication of what he said in Luxembourg yesterday about how long a period of floating he expects us to undergo?

Mr. Barber: On the first point, the London market has opened only today, and the European markets are still closed, and I should therefore have thought that it was too early to draw conclusions. As for the second point, about how long the floating will continue, I have made it clear, as I did last Friday, that it will be temporary. I have explained to our Common Market colleagues that we shall return to a fixed parity as soon as possible.

Prices and Incomes Policy

Mr. Ashton: asked the Chancellor of the Exchequer what review he has now made of Her Majesty's Government's prices and incomes policy.

Mr. Strang: asked the Chancellor of the Exchequer if he will make a statement on the Government's policy towards prices and incomes following recent pay settlements.

Mr. Higgins: We are continuing to urge on both management and unions the need to moderate pay and price increases and to bring home to all concerned the social and economic damage arising from inflation. Both sides of industry are aware of this concern, and the Government hope that the talks taking place with the CBI and TUC will prove helpful in fighting inflation.

Mr. Ashton: Can the hon. Gentleman assure us that he will not carefully wait until the rent increases have been made, the value added tax has been imposed and the price of food has shot up because of Market entry, and then come along with a compulsory wages freeze?

Mr. Higgins: On the second part of that question, my right hon. Friends the Prime Minister and the Chancellor of the Exchequer have made our position clear. As for the housing finance proposals, they will involve those who can afford it paying fair rents, but they will also introduce rent rebate schemes to help the lowest paid and the less well off. This is very important in the context of wage claims. As for value added tax, my right hon. Friend, in giving reliefs specifically to those main areas of expenditure which bear most heavily on low income families, has taken steps so that there is no reason to suppose that value added tax will be regressive. In both these areas we have taken very much into account the effect of this kind of change on low income families and, correspondingly, on wage claims.

Mr. Strang: Have the miners, and now the railway men, ended for good the Government's efforts to de-escalate the rate of increase in wages by holding down settlements in the public sector? Can we look forward to a new initiative in prices and incomes? Will the right hon. Gentleman take into account the fact that trade unions have a responsibility to protect their members against present and future inevitable price increases?

Mr. Higgins: The answer to the first part of that question is, "Most certainly

not". In answer to the last part, the hon. Gentleman should look carefully at what has happened to earnings and prices. In the two years to April, 1972, average earnings rose by nearly 25 per cent., while retail prices rose by just over 16 per cent. The answer to the hon. Member's second question is that over half the public sector settlements have been at 8 per cent, arid under, and the average, even including the rail settlement, has been about 9 per cent. There have been setbacks and some settlements have been very high. But it is absolutely essential that we should continue the process of de-escalation if we are to beat inflation and to get the economy on a sound basis.

Mr. Wilkinson: If exhortation proves to be ineffective in securing wage restraint, will my right hon. Friend be prepared to adopt more positive measures to ensure that our competitive advantage which flotation has secured is not impaired, and nor is the standard of living at home impaired, by inflation?

Mr. Higgins: As I have pointed out, my right hon. Friends have made our position on a statutory policy very clear. It is worth pointing out that the policy which we have adopted over the past two years has been very effective indeed in bringing down the rate of inflation. It is not the case that we should be complacent at the present time; clearly we have a long way to go yet. But we are determined to continue the trend we have established over the last two years, which I spelled out clearly in answer to an earlier Question.

Mr. Sheldon: Is it not clear that whatever the hon. Gentleman may say about the success of his policy on prices over the past two years, his view is not borne out by those who have held sterling overseas? The money market that opened this morning showed a fall in sterling, and this is directly attributable to the Government's failure on inflation. Whatever the Government may say, those people who vote with their money in London have decided that the Government have come unstuck. When will the Government change their policy and bring about some credible alternatives?

Mr. Higgins: Last Friday, my right hon. Friend the Chancellor spelled out very clearly the relationship between his


proposal to float the £ and the question of inflation. This is common ground throughout the House. None the less, this ought to lead all sides of the House to pursue more rigorously policies against inflation, and there is a considerable degree of schizophrenia on the Opposition benches in encouraging wage claims, on the one hand, and complaining about inflation, on the other hand.

Budget Forecasts

Mr. William Hamilton: asked the Chancellor of the Exchequer to what extent his Budget forecasts in relation to prices, incomes, production and investment are on target; and if he will estimate the rate of growth in the economy over the next nine months.

Mr. Higgins: It is not the practice to provide forecasts of prices and incomes, nor is it usual to give estimates of the rate of growth of the economy other than at the time of the Budget. As to investment and output, it is too early to make a detailed assessment of developments in the economy in the first half of this year, but the Budget forecast allowed for a fall in domestic product in the first quarter and the latest indicators of demand and activity appear consistent with the central forecast made at the time of the Budget which covered the 18 months to the first half of 1973.

Mr. Hamilton: I am not sure what that gobbledegook means, but if it means that the Government are on target, does that mean that the measures announced last Friday were planned in June, 1970, and that this was the climax of the Conservative Party's "Better Britain"? Will the hon. Gentleman say what were the reactions of the Ministers in Luxembourg yesterday, apart from the snide remark of the Chancellor just now about my right hon. Friend the Member for Leeds, East (Mr. Healey) when clearly my right hon. Friend was reflecting—[HON. MEMBERS: "Question."]—the effects of the Government's policies rather than the causes of them?

Mr. Higgins: The second part of the hon. Gentleman's question was answered by my right hon. Friend a few moments

ago. The first part was answered by my right hon. Friend last Friday.

Mr. Bruce-Gardyne: My right hon. Friend the Chancellor confirmed on Friday, and again today, that the containment of inflation was our first priority. May we take it that, if need be, such other desirable objectives as the achievement of a particular rate of growth or a particular rate of reduction in unemployment will take second place to this objective?

Mr. Higgins: One must look at the overall economic policy as a whole. Certainly my right hon. Friend made absolutely clear the great importance we attach to the question of inflation.—[Interruption.] I am answering the question, if hon. Gentlemen will listen. The recent unemployment figures have been extremely heartening. On the subject of economic growth, my right hon. Friend has pointed out what our proposals are. One should not overlook the fact that a faster rate of economic growth and greater production may itself be a very important weapon in fighting inflation. That is why we believe that my right hon. Friend's Budget judgment was right, that we must achieve a faster rate of economic growth because the relationship between production and prices is a very obvious one which the House will understand. Therefore, one must not assume that there is any inconsistency between the achievement of these various objectives.

Dr. Gilbert: As the initial result of any downward movement in the exchange rate is usually inimical to the balance of payments, has the hon. Gentleman made an estimate of the result of last week's activities on the Budget forecasts? Furthermore, as European estimates of the severe effect of our coming entry into the Market had an impact on European opinion and helped to move the rate, with what additional burdens shall we now be faced as a result of the dribbling devaluation of the last few days?

Mr. Higgins: I do not accept the hon. Gentleman's final adjectives. As my right hon. Friend pointed out a few moments ago, it is too early to make a statement and we must wait and see how the situation develops.

Oral Answers to Questions — EUROPEAN ECONOMIC COMMUNITY

Mr. Leslie Huckfield: asked the Prime Minister what part he proposes to play in the celebrations for Great Britain's entry to the European Economic Community now being arranged by Lord Goodman's Committee.

The Prime Minister (Mr. Edward Heath): I look forward to being present at a number of functions which are being arranged.

Mr. Huckfield: Does not the right hon. Gentleman consider that the Prime Minister personally conducting a version of Sullivan's "Lost Chord" might be a much more appropriate requiem for the present Government? Does he recollect the words?—[Interruption.] I could sing them if hon. Members would prefer that. Does the Prime Minister recollect the words? They are—[HON. MEMBERS: "Reading."]. They are:
I knew not what I was playing, Or what I was dreaming of.
But—[HON. MEMBERS: "Reading."]. They continue:
But I struck one chord of music, Like the sound of a great Amen.

The Prime Minister: As London is now the greatest musical capital in the world, as London has the best theatre in the world, as our provinces enjoy some of the best artistic performances in the world, and as this country is putting on quite the best art exhibitions in the world, which are to be supplemented in January by some of the greatest contributors in the world, I see no reason why hon. Gentlemen on the Opposition benches should continue to knock the artistic life of this country.

Mr. Sydney Chapman: Is my right hon. Friend aware that there is a feeling in the West Midlands in general and among the citizens of Birmingham in particular that the best way we can celebrate our entry into Europe is to have confirmation from the Prime Minister that the national exhibition centre will be sited at Bickenhill near Birmingham and that construction work on this centre will start in the autumn at the latest?

The Prime Minister: I congratulate my hon. Friend on his ingenuity in bring-

ing this matter into the Question. This is under discussion between the Government and the Birmingham Corporation.

Mr. Shore: Is the Prime Minister aware that the feeling in the country is hardly one which wishes to celebrate entry into Europe on 1st January? Many people consider that this is not a matter to be celebrated. After the events of the past week, when we have tasted the first bitter fruits of European agreements will he call the whole thing off?

The Prime Minister: I do not accept that the country is as miserable as the right hon. Gentleman.

Oral Answers to Questions — POLICY STUDIES

Mr. Duffy: asked the Prime Minister how many policy studies which he has initiated have now been completed but not published.

The Prime Minister: It is our practice in appropriate circumstances to publish major Government decisions in White Papers. We have also published a number of Green Papers for public discussion. Policy studies on which White and Green Papers are based are normally of a confidential character and unsuitable for publication.

Mr. Duffy: Will the Prime Minister say whether the Government will publish the findings of the Docksey Inquiry into the National Research and Development Corporation? Is the Prime Minister aware of the growing concern about the number of important policy studies that are being stamped "Secret" and filed away, in spite of his promises before the General Election? Does he not think this is a crucial factor in the general lack of confidence abroad as well as at home in the management and direction of the domestic economy?

The Prime Minister: I do not accept the hon. Gentleman's last sentence. Mr. Docksey's report is being examined. It deals with the general question of research and development on which we published a Green Paper and on which we have received a great deal of advice and discussion. The Government will publish a White Paper setting out their conclusions. On the hon. Gentleman's question of making information available, we have


published Green Papers on local government finance, Government research and development, corporation tax, value added tax and estate duty, and the Chancellor has undertaken to publish a Green Paper before the end of the year on the tax credit scheme. This is a considerable range of Green Papers, which provide for discussion before decisions are taken.

Mr. Ashley: There has been an internal policy review by the Department of Employment on the employment of disable workers and I am reliably, though unofficially, informed that the review contains revolutionary proposals. The Secretary of State refuses to publish the results of the inquiry. Will the Prime Minister consider overturning the decision by his Minister?

The Prime Minister: As I said in my original answer, very often policy studies which are carried out in Government, and not only in Government, contain a great deal of confidential information which is given by those concerned on the basis that it will remain confidential. It is not possible for Governments to work except by having this information. Therefore on each occasion the study has to be examined to see whether it is suitable for publication. It is right that wherever possible the Government should publish a Green Paper which sets out the conclusions put before them and the options open to them and should make it available for public discussion. In some cases it is put before a Select Committee of the House. I am sure that that is the right way of going about it.

Oral Answers to Questions — WAGE SETTLEMENTS AND INFLATION (GOVERNMENT POLICY)

Mr. Ashton: asked the Prime Minister whether the public speech of the Chancellor of the Exchequer, at a dinner in the House of Commons on 10th June on the rail dispute represents Government policy.

Mr. Joel Barnett: asked the Prime Minister if the public speech of the Chancellor of the Exchequer in London on 10th June, 1972 on inflation represents Government policy.

Mr. Peter Archer: asked the Prime Minister whether the public speech of the

Chancellor of the Exchequer at Westminster on 10th June on the restriction of wage settlements represents Government policy.

Mr. Meacher: asked the Prime Minister if the public speech made by the Chancellor of the Exchequer at Westminster on 10th June concerning industrial relations represented Government policy.

The Prime Minister: Yes, Sir.

Mr. Ashton: In that speech the Chancellor said the Government had inherited a situation which was deteriorating fast two years ago. Is that situation now deteriorating faster or slower, when a £600 million balance of payments surplus has been turned into a mini devaluation in two years?

The Prime Minister: The hon. Gentleman's remarks are typical of the gross exaggeration which does immense harm to the workers of this country, as well as to everyone else. There is no question about the rate of inflation which existed when we came into office. The Opposition cannot deny the impact of wages on inflation, and the Government have maintained their views about that impact throughout their period of office. We have had success in reducing the rate of inflation, and no good can come to anyone from gross exaggeration of the situation. I do not see what pleasure can be gained by the Opposition from constantly encouraging massive wage increases which are unjustified.

Mr. Barnett: The Chancellor of the Exchequer told us that there is nothing wrong with the parity of the £ and that there is nothing wrong with the Government's policies to deal with inflation, and he told us that everything is marvellous, but no one believes him. In these circumstances, are the Government still to persist in policies in which there is no confidence, either at home or abroad?

The Prime Minister: The Government will persist in their policy of reducing excessive wage claims. The Labour Party in office tried a statutory wage freeze and then statutory control and found that action bitterly opposed by its own members and the trade unions and ineffective. It certainly has nothing to offer in place of that policy.

Mr. Hordern: Is it not rather strange that the Leader of the Opposition and other hon. Gentlemen opposite are constantly referring to the £600 million surplus which they left behind, but completely fail to refer to the £1,500 million of debt which they left?

The Prime Minister: Yes, and it is important that the indebtedness has been paid off. But what is even more contradictory is that the Opposition have been urging that the surplus on the balance of payments should be used by expanding the economy. The economy is expanding at a rate of 5 per cent. If the import figures are analysed it will be found that the greater part of imports are manufacturing raw materials and manufacturing fuels and that imports of manufactures have increased by only a comparatively small amount in comparison.

Mr. Archer: If, as the Prime Minister told us, he is concerned to reach an accommodation with the trade unions to agree on a policy, does he appreciate that they will not be encouraged in that if at the same time the Chancellor of the Exchequer and the Foreign Secretary are announcing the imposition of a policy on the unions, whether it is agreed or not? Would it not be better for industrial policy announcements to be made by the Minister responsible?

The Prime Minister: I have read both the speeches referred to and I know of nothing in them which said that the Government would impose a policy on the trade unions. We have made it clear from the beginning that all the discussions we were having were on questions of voluntary arrangements. Therefore when it was agreed between the TUC and the CBI that they should discuss further conciliation machinery on a voluntary basis, the Government fully agreed and we shall come into the talks at the appropriate time.

Mr. Kinsey: As part of that speech referred to arbitration and the use of it, will my right hon. Friend the Prime Minister confirm that this means independent arbitration which takes into consideration the community and consumer interest?

The Prime Minister: I have made plain the Government's view to that effect before and also in the talks to the CBI and

the TUC. They recognise the Government's view. We must distinguish between the process of conciliation, which is being dealt with at the moment, and arbitration, which will come to be considered later.

Mr. Meacher: As the Chancellor preached wage moderation in that speech, what happy inspiration led the Government last Wednesday deliberately to amend the Finance Bill in Committee by increasing by 10 times stock options available to the most highly-paid executives? The Government are offering to directors stock options totalling up to four times their gross salaries. How can the Government decently ask wage earners for moderation?

The Prime Minister: The Financial Secretary has just referred to wage moderation. The increase in wages has been approximately twice the increase in prices—[HON. MEMBERS: "Answer."] I will answer the question and I will do it in my own way. The country requires an improvement in management as much as anything else, and if management is to be encouraged to stay in this country instead of going abroad to take up positions, it must be encouraged in this way.

Mr. Frederick Lee: The Prime Minister was telling us about the period when the Labour Government were trying to contain inflation. Will he tell us whether he was trying to help it by leading his party 25 times through the Division Lobby in favour of all those who tried to break through the ceiling?

The Prime Minister: We have never accepted the principle of statutory control, and the right hon. Gentleman's Administration abandoned it before they left office. We then saw the results of years of statutory control. The dam burst, and we have seen the consequences ever since.

Mr. Edward Short: In the speech to which the Question refers, the Chancellor of the Exchequer trotted out the old parrot cry which the Prime Minister mentioned today and which he mentions every time he opens his mouth—that the major cause of inflation is excessive wage increases. Will the Prime Minister be man enough to admit his own responsibility for inflation? He abolished the Prices and Incomes Board, he abolished


the Land Commission, he put up the price of school meals, he abolished free milk for primary schools and he has en couraged a policy of dear food. He has done nothing about spiralling land prices. All this has been highly inflationary. Is the Prime Minister aware that if he persists with the Housing Finance Bill on 1st October this year, there will be very much bigger wage claims in the next two years?

The Prime Minister: In that case they will be equally unjustifiable. Whatever items the right hon. Gentleman cites, he cannot deny that wage increases overall have been twice as much as price increases. They cannot therefore be justified. If he wants to cite particular instances, he must also cite the reduction in individual taxation which has been made in the last two Budgets and he must cite the action taken by the Government on particular items, such as milk and sugar, which has had a direct effect on prices. He must take into account the massive reduction in purchase tax and the halving of SET by the Government. Nothing can be gained for the workers by gross exaggeration of the situation.

Mr. Speaker: Mr. Jenkins.

Mr. Roy Jenkins: Surely the Prime Minister—

Mr. Hugh Jenkins: rose—

Mr. Speaker: I apologise. Mr. Roy Jenkins.

Mr. Roy Jenkins: Surely the Prime Minister realises that there is grave disquiet both at home and abroad at the prospect, and that this has increased day by day since the announcement last Friday, apart from the period before that? Surely he has some new approach to the problem rather than merely endeavouring to justify everything by quick debating points relating to what happened two years ago.

The Prime Minister: I should have thought that the right hon. Gentleman, in his rather more sober mood, would acknowledge that the commentary right across the world has been that Her Majesty's Government took the right action in the situation, and took it speedily and firmly. In that, there was a great contrast with what happened under his predecessor in his own Administration.

As to the impact of inflation, obviously the Government will persist in the policies of dealing with inflation, but what must be accepted is that wages are a vital factor. In fairness to the right hon. Gentleman when he was Chancellor he never ceased to emphasise that. It is impossible for the Opposition to be in any way credible until they are prepared to acknowledge that once again.

Mr. Hugh Jenkins: To revert to the question of stock options, is the Prime Minister aware that there is no evidence that in general they go to the most efficient managers? On the contrary, there is some evidence to suggest that gross over-valuation of management is a part of the inefficiency to be found in some of the larger companies which go in for such schemes. Therefore, will the right hon. Gentleman look again at the whole question? If he wants to improve management standards, he will not achieve it by this kind of method.

The Prime Minister: The arguments which the hon. Gentleman adduced are very debatable, and I would not accept them in that form. I know that the Opposition have a dogmatic objection to the arrangement, but I ask them to consider seriously the measures which it is necessary to take in order to bring about an improvement in management in this country.

BUSINESS OF THE HOUSE

The Lord President of the Council and Leader of the House of Commons (Mr. Robert Carr): Mr. Speaker, with permission, I should like to make a business statement.
After the business already announced for tomorrow, it is proposed that there should be a short debate on the sub judice rule, on a Government Motion.
On Thursday, instead of further progress on the European Communities Bill, there will be Supply (24th allotted day) when there will be a debate on economic affairs. I should perhaps add that in order to avoid any interruption of this debate the House will be asked to agree that the opposed Private Business due for consideration at 7 o'clock should be postponed until 10 o'clock.
As the House knows, the proceedings on the Gas Bill were not completed on Friday last. It is proposed therefore that it should be taken as first business on Friday of this week.

Mr. Edward Short: I thank the right hon. Gentleman for agreeing to our request for an immediate debate on the extremely serious crisis into which the Government's economic policy has landed the nation.
I should like to ask the right hon. Gentleman a number of questions. First, on the sub judice rule, do I take it that the Government's Motion will be to accept the Report of the Select Committee on Procedure? Secondly, will the Leader of the House agree that it is a borrowed Supply Day, and confirm for the sake of accuracy that it is the third borrowed Supply Day? Thirdly, on what basis is the debate to be taken? We shall certainly wish to censure the Government, either in a Motion or in an Amendment. Does the right hon. Gentleman recall that when the Labour Government devalued we immediately offered two days' debate? We shall require another whole day next week to debate industrial relations, which are just as dangerous and critical as our financial affairs.

Mr. Carr: I certainly recognise that the Supply Day on Thursday is a borrowed Supply Day. I repeat the assurances given through the usual channels that in due course the debt will be repaid.
I shall consult on the basis on which the debate should take place, but I think it likely that it will be for the convenience of the House if it takes place on a Government Motion, which of course the Opposition would be free to seek to amend if they wished.
As to the sub judice rule, the Government, having studied the report of the Select Committee on Procedure, accept the recommendations in relation to certain cases before the civil courts, including the National Industrial Relations Court, which involve applications by Ministers or involve issues of public importance, such as issues affecting the national economy or national security and so on. However, the Government think it would be premature to accept the wider recommendations of the Select Committee in respect of proceedings in

the civil courts generally until the report of the Phillimore Committee has been received. That Committee is dealing with the whole issue of contempt of court, which includes questions of possible prejudice arising out of public discussion and comment on proceedings and so on. We think it wiser to await its report before accepting the widest recommendations of the Select Committee affecting civil courts generally. But we have accepted the recommendations on the National Industrial Relations Court.

Sir Robin Turton: While I appreciate the Government's reasons for not accepting all the Select Committee's recommendations, which I think is probably a very wise precaution to take as the Phillimore Committee is still discussing the matters before it, will my right hon. Friend be putting down a Motion to amend the 1963 Resolution of the House so as to clear the position in the future?

Mr. Carr: I shall certainly be tabling a Motion tonight. I hope my right hon. Friend will excuse me from trying to define it too technically, but I assure him and the House that the object of the Motion will be to give the House the opportunity to affirm in a positive way what the rule should be in the future until we have the Phillimore Report, when we may wish to change it still further.

Sir Elwyn Jones: Does the right hon. Gentleman's answer mean that there will be no inhibitions in the debate on industrial relations, and that the guidelines given by the Select Committee will be those that Mr. Speaker in his discretion will presumably follow?

Mr. Carr: The only inhibitions will be those imposed by Mr. Speaker, and presumably also on the lines of the Motion which I shall Table proposing the acceptance of the recommendations of the Select Committee on Procedure in the respects to which I have referred.

Sir Harmar Nicholls: What is the need for the rush to debate the sub judicerule tomorrow? Should not the Motion be on the Table so that Members may see what they are to debate? Is it not contradictory in one sense to say that we do not want to anticipate the Phillimore Report and at the same time to give way on a very important principle in the way my


right hon. Friend suggested when he described in general terms what his Motion will be? The urgency does not exist. What is proposed is dangerous. We are breaking away from a tradition which has proved to be fair, right and objective. I am certain the Opposition will take full advantage in doing damage to the nation in next week's debate as a consequence.

Mr. Carr: I appreciate the importance which my hon. Friend and other hon. Members rightly attach to the matter. I assure the House that for nearly a fortnight, since the Select Committee reported, the Government have considered the issues very carefully. My right hon. and noble Friend the Lord Chancellor has, properly, been involved in the consultations. He has consulted the heads of the judiciary and so on, and we are satisfied that it is responsible to accept the recommendations which I have indicated, but that it would not be responsible to go the whole hog—[Laughter.]—I did not mean that as a pun—we thought it would not be responsible to go the whole way until we had had the advantage of the Phillimore Committee's report.

Mr. Orme: Is the right hon. Gentleman aware that in declining to accept the complete set of recommendations of the Procedure Committee the Government are restricting us in our discussion of sub judice matters dealing with important industrial issues outside the purview of the issues which he has dealt with? Since we shall want a full debate tomorrow, are we

to asume that the debate will go for some considerable time?

Mr. Carr: We will see how we get on tomorrow and judge accordingly when the time comes. As I understand it, the concern of the hon. Gentleman and many of his hon. Friends has been in connection with the operation of the Industrial Relations Act and the new National Industrial Relations Court. This has not been raised before in relation to the long standing law of this country and the operation of the courts other than the NIRC in connection with industrial affairs. We have accepted the recommendations in relation to the NIRC and certain other actions in civil courts where applications by Ministers are involved and where issues of wide national importance are involved.

Sir H. Legge-Bourke: While I fully understand the reasons why my right hon. Friend feels it necessary to put this down for tomorrow's business, may I ask him whether he regards this matter, as is customary with the reports of the Procedure Committee, as one for the House of Commons as a whole or as inevitably involving Government policy?

Mr. Carr: We asked the Committee to look at this matter urgently and the Government have considered it urgently. I hope that tomorrow night the House will look at it as a genuine House of Commons matter. I do not believe that there ought to be party division, because thesis a serious matter in the constitutional freedom of this country.

Orders of the Day — EUROPEAN COMMUNITIES BILL

[9TH ALLOTTED DAY]

Considered in Committee [Progress, 22nd June].

[SIR ROBERT GRANT-FERRIS in the Chair]

Clause 7

SUGAR

3.43 p.m.

The Chairman: It would be for the convenience of the Committee if in discussing Amendment No. 388 we also discussed Amendment No. 463, in page 11, line 18, at beginning insert:
'Subject to the acceptance, as a protocol to the Treaty of Accession, of the statement issued by the Foreign and Commonwealth Office dated 3rd June 1971 on the conclusion of the meeting with the developing member countries of the Commonwealth'.

Amendment No. 390, in line 28, after 'direct', insert:
(b) in relation to the 1,400,000 tons imported into the United Kingdom by existing members of the Commonwealth Sugar Agreement.

New Clause 3:

LANCASTER HOUSE AGREEMENT ON COMMONWEALTH SUGAR

Section III of Protocol No. 22 (on Relations between the European Economic Community and the Associated African and Malagasy States and certain Independent Developing Commonwealth Countries) shall be interpreted to mean that the question of sugar will be settled in accordance with the agreement reached at Lancaster House between the United Kingdom and the developing member countries of the Commonwealth Sugar Agreement on 2nd and 3rd June 1971.

Mr. Peter Shore: On a point of order, Sir Robert. May I ask you to consider taking with this group of Amendments the Amendment standing on its own, No. 391? It is in page 12, line 16, at end insert:
(4) The home-grown beet crop for 1972 or any subsequent year shall not be less than the existing ratio between this crop and Britain's imports.
The division between this Amendment and the Amendments in the group is a

narrow one, and it would perhaps make for a better debate if we were able to consider it along with the others.

The Chairman: If that is the wish of the Committee, I am agreeable.

3.45 p.m.

Mr. Fred Peart: I beg to move Amendment No. 388, in page 11, line 18, at beginning insert:
Subject to the acceptance by the Community of the Commonwealth Sugar Agreement of 2nd and 3rd June, 1971.
We are now dealing with an important part of the Treaty of Accession. I refer to Protocol No. 17 dealing with the import of sugar by the United Kingdom from the exporting countries and territories referred to in the Commonwealth Sugar Agreement. We are also dealing with Protocol No. 22, which deals with relations between the European Economic Community and the associated African and Malagasy States and also the independent developing countries situated in Africa, the Indian Ocean, the Pacific Ocean and the Caribbean.
This part of the Bill seeks to give effect to the consequences of our negotiations on cane sugar and also on our own sugar industry in this country. There has been an earlier debate, and many hon. Members addressed their remarks to that, discussing the principle of the treaty and the White Paper. The text of the Treaty of Accession signed at Brussels on 22nd January, 1972, shows how wide is the gap between what Britain asked for and what Britain actually negotiated. It also shows how great is the difference between the reality of the negotiations as demonstrated in the context of the treaty and the impression which has been given to Parliament and the British public.
There are many major issues which would demonstrate this but sugar is a good example. The British Government's proposals to the Community were leaked in Brussels in 1970. They asked for the present contractual obligations under the Commonwealth Sugar Agreement to continue until the end of 1974; that thereafter the enlarged Community should take sugar from the developing countries associated with the Commonwealth Sugar Agreement to a total of the present negotiated price quotas, 1·4 million tons; and that the Australian quota of 335,000 tons should be phased out over the length


of the transitional period for British agriculture. We heard about these proposals long before they were given officially to the House of Commons.
It was reported that the Six were not prepared to reach decisions on quantity. Their own sugar regulations are due for review by 1975 and by the same date the Yaounde Convention must be renegotiated. The Six therefore made a counterproposal on 10th May, 1971, which meant that the present arrangements should continue until the end of 1974 and that the developing countries associated with the Commonwealth Sugar Agreement should be offered for the period thereafter a choice between association and trade agreements.
I know that the Chancellor of the Duchy reacted to this. He is on record as saying that this did not constitute a bankable assurance for Commonwealth sugar. This was a phrase used by Mr. Lightbourne, the Jamaican Minister. I know that the Chancellor felt strongly on this, and he tried to give the impression that he wanted these bankable assurances. His rejection of the terms and his demand that "the dialogue of the deaf" should end was not well received by the Six. We were rather pleased with the strong terms used by the right hon. and learned Gentleman, and that phrase of his has often been quoted here.
On the 13th May, 1971, the Six proposed, and the Chancellor accepted, an additional statement of intent to the effect that the enlarged Community would have the firm intention—aura à coeur—of safeguarding the interests of the developing countries whose economies depend to a large extent on the export of basic products, notably sugar. I am sure that anyone who has been to the Caribbean, to Fiji or Mauritius—those parts of the Commonwealth which rely on sugar—will appreciate the importance of that assurance to those areas. Without the safeguards, serious unemployment and economic misery would be created in that part of the world.
The Chancellor of the Duchy made an extensive tour of the Caribbean. I, with the hon. Member for Bromley (Mr. Hunt), had the honour to follow him later. It was expected that the Chancellor would make a firm stand on sugar in the negotiation and would get the bankable assurances which he had mentioned. In

explaining this to the House of Commons on 17th May the Chancellor of the Duchy said:
This text amounts to more than a declaration of intention. It is both a specific and a moral commitment.
I can now say this to the developing sugar producing countries of the Commonwealth. There would be room in the enlarged Community, of which Britain would be part, both for present quantities of sugar from these countries at remunerative prices and for the development of sugar beet production. With this safeguard now promised, I believe the House can be satisfied that these countries will not suffer from our entry into the Community. The assurances which successive British Governments have given to these developing countries have now been double-banked by the Community's commitment."—[OFFICIAL REPORT, 17th May, 1971; Vol. 817, c. 886.]
However, at the Press conference immediately following the session of 12th–13th May the Chancellor of the Duchy was reported in the British Press as saying that the statement
covers at the same time the volume, the production, the prices, the use.
Mr. Schumann at the same Press conference said that this called for
flexibility in the choice of the means, guarantees of quantities, of price, aid in the diversification of production and industrialisation.
Moreover, we know that the French sugar producers had already called for an increase in European sugar beet production of at least half a million tons and a reduction of the Commonwealth quotas to about 6,000 tons. Anyone who is aware of France's position will appreciate the importance of the sugar-beet lobby.
On 3rd June there were the consultations with the Chancellor and members of the Governments associated with the Commonwealth Sugar Agreement. The Brussels statement was there interpreted as
a firm assurance of a secure and continuing market in the enlarged Community on fair terms for the quantities of sugar covered by the Commonwealth Sugar Agreement in respect of all existing developing member countries.
On this basis the Commonwealth Governments concerned accepted the Community's proposals.
The text of the Lancaster House statement was deposited by the British Government with the Six and written into the record. The Six simply took note. I assert that they neither accepted nor


rejected it. But after a ministerial meeting on 7th June the Press reported that a spokesman for the Commission had stated that the Lancaster House communiqué bound only Britain. So there is still uncertainty. I assure hon. Members that this uncertainty still exists in many parts of the Commonwealth.
On 24th June, 1971, the Chancellor told the House:
The developing countries of the Commonwealth who are parties to the Commonwealth Sugar Agreement have been offered the broad protection of whatever form of association or trading agreement they may choose to negotiate. Therefore, if we fail to reach any agreement at all on sugar, which is highly improbable, the existing arrangements would continue."—[OFFICIAL REPORT, 24th June, 1971; Vol. 819, c. 1615.]
The Commonwealth countries concerned with sugar had no choice but to accept Lancaster House. I believe that Barbados was very critical. It was this or nothing, and it was far better to have a unilateral interpretation and a unilateral guarantee by the British Government than to have nothing except the vague words of the Brussels text.
In the light of all this, the Government and the Press tend to treat sugar as a subject now settled satisfactorily in the interests of the Commonwealth sugar exporting countries. I cannot accept that. There is uncertainty, and that is why we should express our doubts today when we have the opportunity to debate the Treaty of Accession.
All that appears in the text of the Treaty of Accession is the vague agreement at Brussels. In Protocol No. 22, it is spelled out in Section III, which says:
The Community will have as its firm purpose the safeguarding of the interests of all the countries referred to in this Protocol whose economies depend to a considerable extent on the export of primary products, and particularly of sugar.
The question of sugar will be settled within this framework, bearing in mind with regard to exports of sugar the importance of this product for the economies of several of these countries and of the Commonwealth countries in particular.
In other words, nothing has been settled. The Community has made only a declaration, that it
will have as its firm purpose".
So we have to consider what the situation is. It means that everything has been

swept under the carpet with a vague declaration of intent. I believe the real negotiation will take place in 1974.
I shall deal particularly with the position of Australia, which is a party to the Commonwealth Sugar Agreement, to which I have referred on a previous occasion. The Australian question has simply got lost. The British proposal to phase out the Australian quota was in itself short-sighted. Britain asked for the phasing out of Australia's Commonwealth quota over the five-year transitional period for British agriculture.
The original intention of the Government was to seek negotiations to cover that period, but nothing was said at Brussels in May, 1970. Since then we have had vague assurances that difficulties would be discussed and a promise by the Chancellor of the Duchy to talk to Australia commodity by commodity. That is not good enough. Australia expanded its production in 1962 because of a world shortage. It cut back in 1968 to negotiate the International Sugar Agreement. That cut-back was mainly to help developing countries. I remind the Committee that the European Economic Community has expanded mainly since 1968 in a time of world surplus. The European Economic Community considers itself extremely progressive in the economic sense, but it refused to sign the International Sugar Agreement, and it has not signed it to this day. The fact that there is now a shortage of sugar does not alter the matter.
Why is it wrong for Australia to behave in the way that it has? Australia has acted admirably, and we should have defended her. Australia has behaved generously to the poorer countries. Moreover, it has been a good supplier of sugar to this country. Why should it be flung out to let European sugar beet growers have preference in our market? Australia may be a rich country, but its sugar is far cheaper than EEC sugar. The Australian negotiated price, under the Commonwealth Sugar Agreement, is £50 a ton. The raw equivalent of the EEC best beet sugar has an intervention price of about £80 a ton. There is a considerable difference. Moreover, if Australia is flung out, 350,000 tons of sugar goes to the free market and will compete with the developing countries. Inevitably, that


will depress the price of sugar, which will have consequential effects on many parts of the Commonwealth.

Sir Robin Turton: Surely the right hon. Gentleman is quoting a wrong figure. Under the new price scheme of the Common Market the intervention price is £98·81 a ton.

4.0 p.m.

Mr. Peart: I was given this basic rate by a sugar expert. If it is higher than that, I gladly accept what the Father of the House has said. Nevertheless there is a difference, and it shows that Australia has produced sugar for us at a lower price than that at which we shall get it from the Community.
Indeed, with a view to the International Sugar Agreement due to be negotiated in 1973, this amount of sugar which I have mentioned could make the quota negotiation difficult, if not impossible. So I would say this afternoon that the least Her Majesty's Government should do is force the enlarged Community to agree to phase out the Australian quota as slowly as possible. I am sorry that it is going to be phased out but, if it is to be, let there not be indecent haste. This is not only a point for Australia, though in my judgment Australia deserves more points than she gets; it is also a point for us, who have a favourable balance of trade with Australia, and for the developing countries which will have to compete at a later time with sugar-beet producers in Europe.
Hon. Members must realise that many of the Commonwealth producers do not simply rely on the Commonwealth Sugar Agreement. Some of them are involved in the International Sugar Agreement. Both Mauritius and Fiji sell one-third or more of their crop to the free market. Again, Australian raw cane sugar represents about 18 per cent. of Tate and Lyle's turnover in this country, and in the chairman's statement in its 1970 annual report considerable anxiety was expressed about this loss of raw material.
Naturally, the Australians are disappointed with us, and the speeches of Mr. Anthony the Deputy Prime Minister of Australia, have been critical of the negotiations. I know the Chancellor has tried to give a different impression, but

Australian people feel very angry about it. We have a favourable balance of trade with Australia. The Australians have helped us in peace and, as I have said so often, they helped us in a critical period in time of war. So I think it is a tragedy that we are doing something which can harm some of our Commonwealth friends—not only Australia, but countries in the Caribbean, countries like Fiji and Mauritius.
Today we are debating really an important part of the Treaty of Accession. It is something, too, which can have a bearing upon our own industry here. Over the years we have controlled our sugar-beet acreage because of the Commonwealth Sugar Agreement, and our own British producers have accepted this generally. If we do something wrong here we could harm a generation in those parts of the world, something which would be against the best interests of Britain. So I hope that the Chancellor of the Duchy of Lancaster or the Minister who will be speaking in this debate will say quite honestly and frankly that they have really negotiated nothing, that it is merely on the record and that renegotiation will have to take place at a later date. It is for these reasons that I move the Amendment.

Mr. Neil Marten: I should just like to comment on the appalling fact that this great subject, so important to so many of our people in the Commonwealth, is to be given only about 3½ hours' debate. I am sure that if they realised this they would be shocked that this Mother of Parliaments was treating them in this way after all these years. I am deeply ashamed that we are in this situation and that the Government are in such a great hurry to get this Bill through.
Of course, this criticism goes back to a point I have made consistently, which is that before this debate started we should have debated the Treaty of Accession, which we have never done in this House. When we raised that question, time and time again we were told that there would be time during the Committee stage on Clause 7 to go into sugar and on Clause 6 to go into agriculture. But that was before the guillotine, so I am afraid that those undertakings have not been fulfilled. I am sure our Commonwealth sugar-producing countries would be deeply shocked if they knew


what was happening, because this subject, which is something of a specialist subject when we talk about prices and quotas and so on, is in fact a very human matter which affects the lives of a great number of people, very often in rather small and out-of-the-way islands.
Like many right hon. and hon. Gentlemen in this Committee, I suppose I have visited, in company with some of the hon. Members in this Chamber at the moment, some of those places, such as Fiji, the West Indian Islands, Mauritius, and indeed Queens land also but I would not call that a developing area. It is only when one goes round the sugar plantations in Fiji or Mauritius and see a 5-or 10-acre patch being worked for cane sugar by one family, which may be supporting 10 or 15 people, that one realises the enormous significance of the Commonwealth Sugar Agreement with its guaranteed prices and its quotas. Anything that destroys or harms that is something that would never in this world have my support. I believe that this so-called agreement is not valid in law and could well not be honoured when we set to the renegotiating period of 1974–75.
I imagine that most of the speeches in the debate today will follow very much the same lines and will contain a number of quotations, which of necessity will be the same quotations. My text, as it were, for this contribution is on page 100 of the Treaty of Accession, Part I—that is, Protocol No. 22, Part III, the one which the right hon. Member for Workington (Mr. Peart) has already quoted:
The Community will have as its firm purpose the safeguarding of the interests of all the countries referred to in this Protocol whose economies depend to a considerable extent on the export of primary products, and particularly of sugar.
The Commonwealth Sugar Agreement ends in 1974 and the Common Market Sugar Agreement with its associated territories has to be renegotiated in 1975, so we are talking about the period 1974–75. The question I should like to put to my right hon. Friend the Minister of Agriculture, Fisheries and Food, who is going to answer this debate, is whether the Lancaster House Agreement will be honoured, and can be honoured. If it cannot—and this is a direct question—will he give an assurance that the Gov-

ernment will use their veto? I hope he will not suggest that this is a hypothetical question, because it is in many ways the heart of the whole matter. Whether it is hypothetical or not, we must look to this contingency of disagreement when we come to renegotiate and what happens if there is such disagreement. If the Government use their veto—and there is an admission that they can do so, because the Chancellor of the Duchy of Lancaster has said:
…if we do not get safeguards for the interests of the developing countries, then we could exercise a veto."—[OFFICIAL REPORT. 17th May, 1971; Vol. 817, c. 896.]
—what then happens?
Can we have a firm statement on that, because I imagine that if we exercise the veto on any further discussions or arrangements we go back to the common agricultural policy, when the derogations which we have been so graciously allowed by the Common Market to honour our existing contracts will no longer apply and the Commonwealth Sugar Agreement countries get precisely nothing but simply come face to face with the common agricultural policy. That is the position as I understand it, and I should be grateful to the Minister if he would confirm that.

Mr. Shore: Would it be possible for the Minister who is to reply to the debate to answer this serious question? There is no point in us going on to the end of the debate when one of the crucial questions relates to the explicit answer to what has been put to him. We want to know whether a veto is available to us and, if so, whether it is the clear intention of the Government to use it.

Mr. Marten: I am willing to give way to either of the two Ministers if one of them is willing to answer that question straight away.

The Chancellor of the Duchy of Lancaster (Mr. Geoffrey Rippon): We have discussed on many occasions the whole question of the veto and the Luxembourg Agreement. My hon. Friend well knows that circumstances in which the Community works and that in practice it never operates against the national interests of any of the countries concerned. We have discussed the four matters on which we have put down these markers. My hon. Friend is seeking a


repetition of our debates. The words that we have used on all previous occasions have been carefully selected, and I stand by them. Incidentally, they have been accepted as assurances by the countries concerned—namely, the sugar producing countries, one of which, Mauritius, has already negotiated its association agreement.

Mr. Marten: I recognise that the words have been carefully selected. As for the agreement with Mauritius, it would perhaps have been more informative if my right hon. and learned Friend had told the Committee that the one thing it did not contain was any agreement about sugar. It was an agreement on industrial trade and excluded sugar. It is unfortunate that that should have been left out.
To use the expression one hears occasionally in church, let us hear what comforting words the Chancellor of the Duchy has said:
As far as the sugar régime is concerned, perhaps talk of vetoes is unfortunate….
In other words, I think he rather regretted having said that the veto could be used—
…because I am satisfied that the Community meant what it said, and that we can reply on that.
The Chancellor of the Duchy speaks for himself and, I imagine, for himself alone, certainly not for the House of Commons, although he might speak on that for the Government.
If, at the end of the day, a situation arose which we could not agree, then one would no doubt have a crisis in the Community, which we would resolve, holding firmly to the assurance we have been given."—[OFFICIAL REPORT, 17th May, 1971; Vol. 817, c. 897.]
In other words, there would be no "give" by us. If there were a crisis and we would not give, how could that crisis be resolved? There is good reason for having the matter cleared up.
The intervention of my right hon. and learned Friend did nothing to clear up the point, which is this. If we use our veto—and my right hon. and learned Friend has admitted that we can—do we, or do we not, then go back to the common agricultural policy? Do these derogations cease to exist if we use the veto?

Mr. John Mendelson: Perhaps the Government could claim that it is not the most convenient way to give

such a far-reaching assurance in an intervention. Perhaps it would be more reasonable, after the hon. Member for Banbury (Mr. Marten) has finished his speech, to allow the Minister to give a reply to this important question in his own way.

Mr. Marten: As always, the hon. Member for Penistone (Mr. John Mendelson) is very helpful to the Government Front Bench. Doubtless Ministers will have at heart what he has said.
4.15 p.m.
Let us look at what the French think about it. Dearly as I love the French—as the Committee knows, I am very pro-European and have within me, and am proud of it, French and probably Gaullist blood—I am suspicious about them over the question of sugar because I also love, perhaps more dearly, the Commonwealth, particularly the developing Commonwealth. Looking at the production and consumption of sugar in the enlarged Community in 1971—although it was not enlarged then, one can make the additions—one finds that the enlarged Community was short of only about 300,000 metric tons of sugar. I understand that already the French have planted beet to cope with that gap.
What worries me is that production and consumption are roughly in balance, and that next year and possibly the year after they will also be in balance, because my hon. Friend the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food has said:
Given normal beet yields, I would expect the surplus of the enlarged Community in 1973 to be much the same as the average surplus of the existing Community of Six over the last few years. It is too early to forecast the position in 1974."—[OFFICIAL REPORT, 20th June, 1972; Vol. 839, c. 53.]
It does not look as though there will be much change.
A National Farmers Union paper of 20th May reports from Paris that the French Sugar Beet Growers' Association has announced a 5 per cent, increase in planting this year, making a total of about 1,103,000 acres of beet sugar. That will produce practically the amount of sugar guaranteed under the Commonwealth Sugar Agreement. We therefore have every right to be suspicious of the French beet sugar growers. When 1974–75 comes along and the agreement has to


be renegotiated the French will have boosted their production sufficiently to take up that Commonwealth Sugar Agreement portion. That is the reality, and that will lead to head-on collision between ourselves, on behalf of the Commonwealth sugar countries, and the Common Market.
Against that background I am anxious that the Lancaster House Agreement will not, and cannot, be honoured, much as the intention might be at present that it should be honoured. The Amendment therefore seems an obvious one. If the Government do not accept the Amendment, there will be grounds for the deepest suspicions. All the Amendment does is to strengthen the Government's hand when they come to renegotiate in 1974–75.
If the French are planting over 1 million acres, the Commonwealth sugar countries will have to put their surplus on the world market and the price will come rocketing down, particularly as there must be added to it nearly 400,000 tons from Queens land, Australia, which I reckon has been carted for six, if I might use a Test Match expression about that great country which has done so much for us. Apart from the Commonwealth sugar portion or quota, Fiji and Mauritius have to sell over one-third of their production on the world market, so if they do not get their CSA quota, that, in addition to the one-third, will go on the world market.
I wish finally to refer to a publication, the translation of which I have, of Sucrerie Française August/September, 1971, which speaks of the Lancaster House Agreement:
It is indeed rather surprising to find the statement that 'the British Government and other participating Commonwealth Governments consider this (i.e. the EEC's) offer as a firm assurance of a stable and permanent market in the enlarged Community, on remunerative terms, for the quantities of sugar provided for by the CSA for all the developing member countries.…The EEC never intended to commit itself at the present stage to such wide and precise undertakings.
I think I should repeat that passage. It was a remark made about my right hon. Friend's negotiations. He was in conversation with his colleague when I quoted it:
The EEC never intended to commit itself at the present stage to such wide and precise undertakings.

the translation of the Sucrerie Francaise continues:
Lastly, on the 5th June, 'Le Monde', in commenting on the communiqué of the 3rd June, set out above, quoted official sources close to Mr. Rippon as stating that he would merely inform the Six at Luxembourg on 7th June, of the position laid out at Lancaster House, without requesting their approval of the interpretation made by the Commonwealth (and by himself) of the nature and scope of the commitments of the Community. It seems that this was the course which was in fact taken.
That is a Press report. Further on it reads:
It seems, according to certain pieces of information, that the EEC is simply 'taking note of' the communiqué, which evidently does not constitute a commitment.
There is a footnote which reads:
Mr. Schuman said in precise terms that this document committed only the UK, and the Community merely took note of it for information.
This Amendment moved by the right hon. Member for Workington makes good sense and will greatly strengthen the hand of the Government when it comes to negotiate.
I appeal to those many Members in Parliament who have at heart the welfare of the developing countries. Whatever they think of the Common Market, they might like to support this Amendment. If they do not, one will begin to think perhaps that their care for the developing countries may be a little transparent and not as clear as some of us thought.
I hope on this occasion that all those hon. Members who have the interests of the developing countries at heart can support this Amendment when it comes to the vote.

Mr. Alfred Morris: The Amendments were eloquently and powerfully moved by my right hon. Friend the Member for Workington (Mr. Peart). Each of the Amendments has my warm support. I am a sponsor of all but one of them and the principal sponsor of new Clause 3. There can be no justification whatever for the rejection of new Clause 3. Certainly, there can be no criticism of its importance or of its form. With my co-sponsors, I took the best possible drafting advice available to hon. Members of this House. If the new Clause is opposed, the implication is that the European Communities Bill is unamendable. The need for an


amendment in terms of new Clause 3 is to ensure that the European Economic Community places the same interpretation on the Lancaster House Agreement as does the Treasury Bench in this House.
In common with hon. and right hon. Gentlemen on both sides, I deplore the absence of any reference to the assurances given at Lancaster House in the text of the treaty negotiated with the Community. The text contains only a general assurance of intention. It contains no reference to the precise interpretation given to our assurances to the Commonwealth sugar producers at Lancaster House.
It must be emphasised that the Lancaster House Agreement was rightly accepted by the 14 developing Commonwealth Governments, and the Commonwealth sugar exporters, as providing a firm assurance from the British Government on markets in the enlarged Community. The communiqué from Lancaster House made it clear that the Commonwealth Governments accepted the Community's proposal only on the basis of the interpretation put upon it at Lancaster House.
The European Economic Community has sealed its lips. There has not been a breath of comment as to whether it put the same interpretation upon the Lancaster House Agreement as do the Commonwealth sugar producers and exporters.
Many sections of the Press have attempted to treat the question of sugar as one which is now settled. They even imply it is settled satisfactorily in the interests of the Commonwealth sugar exporting countries. But all that appears in the Treaty of Accession is the vague agreement at Brussels. There is nothing else. The Lancaster House communiqué was, of course, merely noted by the Six. So there could be nothing else. This means that everything has been swept under the carpet with a vague declaration of intent. That is not good enough for very many hon. and right hon. Gentlemen on both sides of the Committee.
My right hon. Friend the Member for Workington emphasised that quantity is important. One of the Amendments

argues that we must be prepared to pledge continued access to this country of 1,400,000 tons of Commonwealth sugar if and when we enter the European Economic Community.
Many of the poorer Commonwealth countries depend for their very existence on exporting sugar to the United Kingdom. The hon. Member for Banbury (Mr. Marten) referred in particular to Mauritius. He may perhaps recall Josef Conrad's phrase. He said of the people of Mauritius that sugar is their daily bread. Well upwards of 90 per cent, of their exports consist of sugar and sugar by-products. We cannot simply turn aside from the difficulties of the world's poor.
It was emphasised to the House earlier in our debates on the Bill that terms of trade have recently been moving strongly against the poorer countries in favour of the richer countries. It has been shown that in the last 15 years the benefit of aid programmes to the new nations of Africa has been almost totally eliminated by the increasingly adverse terms of trade, which have deteriorated by about 15 per cent. since 1950. The poor cane sugar farmers of the West Indies and those in countries bordering the Indian Ocean and the South Pacific now have to produce much more sugar to buy a tractor. It can hardly be right that this Parliament should refuse the poorer Commonwealth countries a definite assurance about their economic future.
Aid to developing countries is deeply important. In the long term, however, trade is far more important than aid.
My friends in the poorer countries have told me again and again how much they dislike charity. Of course, they need charity now. But they do not want indefinitely to have to rely upon crumbs from the rich man's table. The Commonwealth Sugar Agreement is an instrument that helps them to plan their economies and sustain their independence. They would lament any possibility of a phasing out of the Commonwealth Sugar Agreement. We ought to remind ourselves in this debate that 75 per cent. of mankind live in poverty. Moreover, many of those who live in the direst poverty are people who depend on producing cane sugar for their livelihood.
4.30 p.m.
My right hon. Friend the Member for Workington also referred in his speech to Australia. There is an illusion that every farmer in Queensland is a rich man. It is just not true. Many of us have personal friends there, and we know that they have served this country well in good times as well as bad. There is no case at all for excluding the Queenslanders from the British market. They produce cane sugar very efficiently. They are far more efficient than the French or the West Germans—and they make important purchases from this country in return. It must be stressed again that in recent years we have had a very favourable balance of payments with Australia. Why then should we now be asked to turn our backs on traditional friends?
I hope the Committee will now assert its authority against the Government. There are those on both sides of the Committee who know the realities of the situation facing the poorer Commonwealth countries and who are aware of the implications of our decision on these Amendments. My right hon. Friend the Member for Kettering (Sir G. de Freitas) was himself a leading sponsor of an early-day Motion on the Commonwealth Sugar Agreement. My right hon. Friend is an ardent supporter of British entry into the Common Market. In that Motion, however, together with right hon. and hon. Members on both sides of the political fence, he implored the Government to see that there were definite assurances for the Commonwealth sugar producers as a precondition of entry. I hope that all who signed that Motion will stand by their word in the Lobby tonight. I trust that at the end of the debate they will go into the Lobby to give effect to the terms of their Motion.

Mr. Marten: I hope that the hon. Gentleman is not implying that there are right hon. or hon. Members on this side of the Committee who signed that splendid Motion who would do other than support these Amendments. I am sure that nobody on this side of the Committee who took that earlier view would do such a disgraceful thing as not to support these Amendments tonight.

Mr. Morris: It would certainly be a sad moment if any right hon. or hon. Gentleman on either side were to go back on his signature on that extremely important early-day Motion. No doubt tomorrow the Division lists will be examined with care and will be compared with the signatures on the early-day Motion to which I referred.

Sir Anthony Meyer: Would the hon. Gentleman express the equal hope that those of his right hon. and hon. Friends who voted in October in favour of Britain's entry into Europe will stand by their vote on that occasion?

Mr. Morris: None of my right hon. or hon. Friends has ever expressed any support for phasing out the Commonwealth Sugar Agreement. We have only to look at these Amendments to see that there is no possible justification for rejecting them. Therefore, I hope the Committee will proceed to assert its authority by agreeing these Amendments to the Bill.

Mr. Charles Morrison: I have the highest possible regard for the negotiating ability of my right hon. and learned Friend the Chancellor for the Duchy of Lancaster. But I must admit that my regard for his ability is not so high as to believe that he was capable of forcing representatives of the Governments involved in the Commonwealth Sugar Agreement to agree against their will to the Lancaster House statement, or of so misleading them as to persuade them that what they were accepting was reasonable when it was not. It seems to me that the first of those alternatives would have been an insult to the strength of character of the representatives of the Commonwealth countries concerned, and the second would have been an insult to their intelligence. Yet it is those alternatives which seem to be the implications behind the Amendments and the comments made in their support.
The right hon. Member for Workington (Mr. Peart) said that the Commonwealth Governments had no choice but to accept the offer on sugar. Why did they have no choice? They need not have accepted the offer. If they had not done so—and it was entirely up to them—it would have been open to the British Government, if they had felt so inclined, either to break off negotiations with the Common Market countries if they felt


unable to obtain anything more from them, or to negotiate a harder bargain with the Common Market. The fact to be borne in mind is that the offer was accepted and the agreed Lancaster House statement was made.

Mr. John Mendelson: Surely the hon. Gentleman is far too exclusive in putting forward only two possibilities. Does he not know from the participants at the conference that the British Government said to the sugar producers "We shall do neither of these two things, and you must accept the position"? Secondly, does he not appreciate that credits must be provided for continuing sugar production and that the sugar producers are not their own masters in that respect?

Mr. Morrison: The hon. Gentleman claims to know a lot of things, though I do not know how he knows them. However, even if he is right, there was still no need for the Governments concerned to accept the offer. They could have reserved their position and said that they did not agree with what was being put to them. It would then have been up to the British Government to come to Parliament to try to obtain support for what had been negotiated.
I believe that the Governments involved in the Commonwealth Sugar Agreement accepted the situation not only because they were satisfied with the arrangement on sugar but also because of the new opportunities which would be available to them from a closer relationship with the Common Market. Those countries will have the option of an offer of association with the enlarged Community, and that association would give those countries preferential access to a far larger market for some of their other products and exports. Furthermore, by becoming associated with the enlarged Community the developing countries would have the opportunity of further development aid from the Community. I have no doubt that it was in the light of those further thoughts that the Governments concerned agreed with the terms of the Lancaster House statement. I believe that the association of those countries with the Common Market will provide new and better export opportunities for the gradually developing countries.
The hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) said

that trade was better than aid. I agree with him, but I also feel that there will be far better opportunities for trade than those countries have enjoyed up to the present when this country is a member of the Community and when the developing countries are associated with the Community.

Mr. John Mendelson: The speech made in good faith by the hon. Member for Devizes (Mr. Charles Morrison) is only possible because of the deliberate refusal of Her Majesty's Government to supply the Committee or the House of Commons with any information about these discussions. It is precisely because the Government knew that if they were to provide proper information about these discussions there would be such an outcry from their own benches, let alone from my hon. and right hon. Friends. It is a tragic sequence of events that this Committee, on behalf of the House, at this late stage in the proceedings should still be working in the dark as far as these negotiations are concerned.
There are sometimes complaints in this House and in Committees of this House of Commons about matters which are far less important than the subject with which we are concerned, where the Minister representing the Government gets up in a Committee upstairs and says that he has seen the housing associations, he has seen associations of manufacturers, he has seen all these bodies and reached agreement with them. Every member of the Committee gets up and shows himself completely dissatisfied with that approach. The Government are accused of being well on the way towards a corporate State. Members of the Committee charge the Government with refusing essential information to the elected Members of Parliament who are supposed to be, according to the Government, so much in control of this legislation; who are the only people, according to the Government, who are fit to pass judgment on the legislation the Government are putting before the House.
In such matters, not as important as this legislation, Members of the House of Commons refuse to accept the Government's statement that they have cleared this in secret negotiations with bodies outside and that they cannot give the details to the Committee of the House. They ought to do the same thing this afternoon.


According to the Government, Members of the House are the only people who could have a hand in making this final decision. They have refused to go to the country in a General Election. They have refused a referendum. They have said that only Members of the House are the proper people, having been elected by their constituents, to pass judgment on these matters.
I have twice asked the Leader of the House, who is responsible for Government publications, to produce these exchanges and this correspondence before this afternoon. Nothing has been published in addition to what we have already had with the cursory references that my hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris) made a few moments ago. I would say to the hon. Member for Devizes that he is quite wrong and misinformed on the position in which the sugar producers and the sugar-producing countries found themselves in the Lancaster House discussions. First of all, the Government made it quite clear to them—and we have the Minister to reply, and I am within his hearing; he can correct me if what I say is untrue—that in no circumstances were the Government prepared to break off the negotiations with the Six if they could not get the sugar agreement they wanted. They were told that this was going ahead, that it was a fait accompli, and that they had better accept it.
Secondly, several Ministers—one of whom said so in public on television immediately after the Lancaster House discussions had concluded that afternoon—demanded in a private meeting that the British Government should go back and say that they wanted the Lancaster House declaration accepted as part of the agreement. That is a fact, and let the Minister deny it if he wishes. Far from declaring themselves satisfied, several Ministers rehearsed the fears which have been expressed in this Committee this afternoon before any Member of the House of Commons ever did so. They knew their responsibilities. The Government's reply was that if the others were prepared to accept it, then they would be very pleased, but that they were not going to insist upon it. If the others did not accept it, then they would have to accept their refusal. That was the Government's

position. Let the Minister deny that if he wishes.

[MISS HARVIE ANDERSON in the Chair]

4.45 p.m.

Therefore, the hon. Member for Devizes should accept in equally good faith from those of us who have looked at those facts that this information is wrong, that the sugar-producing Governments were not in a position to act freely as indicated. What were they to do? If they merely broke up the negotiations altogether and said that they would have no further contact at all, that after all they were the customers, it would have been a ridiculous attitude. That is the reply to the contribution made by the hon. Member for Devizes.

We have to accept our responsibilities in this respect. It is for us to decide—I mean the Government as well as the House—whether we can accept, in all conscience, the way in which we have treated these countries and whether we can be responsible in future for having accepted the refusal of the Six to read this part into the Agreement between them and us.

I can understand the difficulty in which the Minister finds himself this afternoon, to answer the question put by the hon. Member for Banbury (Mr. Marten). After all, this is serious work which we are doing in this Committee. We are not trying to catch each other out. There is no value in trying to score a point against the Minister on a matter of this magnitude. We do that on other matters because we know that two months later we can go back and change it round again. I can understand the Minister's difficulty, because he knows that he has an overriding decision by people far more powerful in his Cabinet than he is: that there was going to be no listening to the sugar producers; that they were going to be sacrificed to the refusal of the Six to accept the Lancaster House declaration into the Agreement. That is the reality of the position.

I say to the Minister that this argument is not concluded. This argument will continue, and it will continue in the country where the Government do not want it to continue. They have illusions if they think that if they carry the vote


in this Committee, and later in the House of Commons, their responsibility will be forgotten or wiped away. There is real difficulty in the Minister's position.

I also believe that it would not be beyond the bounds of possibility, remaining still in the negotiations with the Six, for the Government to accept the wisdom of the Committee on this matter and change their own position. After all, Mr. Schumann refused point blank—and this has been quoted by the hon. Member for Banbury; I quoted it once before in similar terms in a debate in the House rather than in Committee—to go beyond the formal declaration after the sugar negotiations had been completed. This was the British Government's point of view and it in no way committed any of the Governments of the Six.

Whatever the Government have failed to do in the past in coming back to us and reporting this, as the Chancellor of the Duchy never did, time has moved on since then. Surely it is possible, if the Government maintain the position that they will play an important part within the Community if we join, for them to say that they have had many representations made to them, that this is a parliamentary democracy, that there is powerful opinion in the House of Commons that this is not to be accepted in this way. They could go back to the Six and seek to reopen the discussions on this matter. What is to stop them? I cannot believe for a moment that it is this nonsense about having to devote five or six days to a Report stage which will finally prevent them from accepting an Amendment which they believe to be reasonable in their own minds. That would be an attitude of irresponsibility that even I should find it hard to believe.

What may be the more powerful reason is that the Prime Minister wants to ensure that there are no difficult negotiations or discussions yet ahead of him before he can attend the first summit meeting, if there is such a meeting; the French Government have not yet made up their minds about it. But if there is any sense in having real, continuing discussions as potential members of the Community, surely the Government ought now to say that they will listen to the voice of the House of Commons on this matter and that they will begin negotiations demanding that the Lancaster House

declaration shall become part of an agreement between the Six and ourselves and not merely a matter of which they take note. If there is a summit conference, it might be that the run-up to it could be used for the negotiation of this matter.

Surely that is a practical proposition which many Members of Parliament would support gladly. On a matter where opinion is expressed so freely and where even those who are inclined to give the Government the benefit of the doubt put forward the view that the Government's interpretation is not correct on the facts, surely it is incumbent upon the Government to say to the Committee, as they are so concerned with parliamentary democracy, "We accept in some form what so many hon. Members urge upon us."

I do not know what the Government's reply to such a case might be. However, if the Government were to adopt that attitude, it would not be contradictory to their general purpose of wishing to join the Community. Many hon. Members whatever their views on the general principle, would rejoice if the Government adopted this attitude. Surely there is a very powerful case for the Government to consider. There must be some very strange reasons if they refuse to meet the Committee on this issue.

Sir Robin Turton: I agree with the last words of the hon. Member for Penistone (Mr. John Mendelson), and I think that my hon. Friend the Member for Devizes (Mr. Charles Morrison) made the strongest speech that could be made from either side of the Committee in favour of this Amendment. However, I take issue with the hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) who talked about breaking the Government in the Division Lobbies. That is not the purpose of the Amendment. It is designed to turn what has been described as a specific and moral commitment into a specific, moral and legal commitment. That is the issue that we are discussing today.
My hon. Friend the Member for Devizes said he was certain that the Government were sincere about the Lancaster House agreement. So am I. So are the vast majority of hon. Members. However, we are not certain about how far the Community representatives hold the same view. That is why it is important by some


means to put words into the Bill which will tie down the Six as well to the Lancaster House agreement.
I remember on 11th May how proud I was when my right hon. and learned Friend the Chancellor of the Duchy spoke out for Britain and the Commonwealth and how surprised I was at what appeared to be his volte-face the following day. It is more than a year ago now, but I remind the Committee of the report which appeared in France-Soir on 14th May:
Mr. Rippon, on Tuesday, had made a very violent plea in this connection: 'If we do not get out of this bog, we shall do harm to ourselves,' he declared. 'This dialogue of deaf people must end.' On Wednesday he went into reverse. The French pointed out if these outlets were guaranteed to the Commonwealth countries for their sugar, the same should apply to the countries already associated, such as Senegal, and Niger for their ground-nuts and Tchad for their cotton. Finally, Mr. Rippon was content with a promise…Mr. Rippon thus cancelled his 'outburst' of Tuesday, which had made such a bad impression. The English journalists, in interviewing the British delegation, strongly emphasised this volte-face, and it is probable that the comments of the English press will be severe.
This is the reason why it is vital to reassure our Commonwealth suger producers, who have to plan on a long-term basis. Their position is not like that of my constituents who grow beet sugar. In cane it is necessary to plan on the long term.
While I have no doubt about the firm resolve of my right hon. and learned Friend, I fear that these words are being interpreted differently by the Community and by Her Majesty's Government. I say that because of the report in Le Figaro describing the Press conference on 13th May, when my right hon. and learned Friend declared:
The French expression 'sauvegarder les interets' is very strong. It covers at the same time the volume, the production, the prices, the use.' Mr. Schumann, who was sitting next to Mr. Rippon, submitted his comment differently: 'Sauvegarder les interets calls for flexibility in the choice of the means, guarantees of quantity of price, aid in the diversification of production and in industrialisation'.
I hope that we shall be told that we regard this safeguarding of interests in the light of what my right hon. and learned Friend said on 14th May.
Turning from that to what was touched upon by my hon. Friend the Member for

Banbury (Mr. Marten) and the right hon. Member for Workington (Mr. Peart), I am not happy that these Amendments cover the point that they raised about the Queensland farmers. I hope that the Government will try to devise some way in which in the Bill we can give more reassurance to the Queensland farmers than they have at the moment.
The assurance was given by my right hon and learned Friend when he was in Canberra. On 18th September, 1970, he told the Australians:
I am well aware how vital this matter is for some of your farmers in economic and human terms. I promise you that we shall treat it extremely carefully and seriously in close consultation with your Government. This is, when all is said and done, a matter of mutual concern. We have made it plain that we shall seek the longest possible transitional period in which to resolve these initial difficulties.
That was a definite pledge by Her Majesty's Government that they would have a long transitional phasing out of Queensland sugar under the Commonwealth Sugar Agreement. In the White Paper, in the Accession Treaty, and in the Bill there is no provision at all. After 25th February, 1974, out goes Queensland sugar with no phasing out at all.
I beg my right hon. Friend to realise that this has aroused a good deal of bitterness in Australia and in relations between this country and Australia. I ask him for an undertaking that he will continue to demand from the Community a proper, long period of phasing out of Australian sugar, so as not to harm the economy of Australia, particularly Queensland, or the world sugar market.
5.0 p.m.
One of the great difficulties is that the Community has remained outside the International Sugar Agreement. It should be the policy of this Government that, if there is to be an enlarged Community, that enlarged Community should be a member of the Agreement. We have abandoned, I am afraid, most of our Commonwealth links, but in the enlarged Community, we can bring our Commonwealth partners and with them the wider world developing countries' interests into a relationship with the Community. That means a completely new approach by the Community to the International Sugar Agreement.
I am not happy about Protocol 22 of the Treaty of Accession, because the history of Association for sugar-producing countries has not been happy. After all, Congo-Brazzaville and Madagascar were both sugar-producing countries and tried to export sugar to the Community after it was formed. Levies kept those sugar imports out and the trade virtually stopped. Surinam used to export sugar to Holland. When the Community was formed, it was said that this contravened the EEC regulations. To avoid a case being brought in the European Court, it was eventually agreed that these exports should be cut by half and would continue only until 1975.
My hon. Friend the Member for Devizes said that this was a wonderful thing that was being offered—Associated Status. What good is that if sugar is excluded? What good is that to the little island of Mauritius, 95 per cent, of whose exports are in sugar? What good is that to Jamaica, which at the moment has 18 per cent, unemployment? We feel terrible when our unemployment touches 6 per cent. The economies of these countries depend on sugar. That is why it is desperately important that the Government should put in the Bill a firm declaration of where we stand on the matter of sugar.
It is curious that up to now everyone has talked about the Commonwealth and the developing countries and no one has mentioned some people who are quite as important—the housewives of this country. Protocol 17 deals with the imports and pricing of sugar into this country. Paragraph 3 says:
The price at which the sugar in question is marketed in the United Kingdom shall be fixed at a level such as to allow the quantities in question effectively to be marketed without prejudice the marketing of Community sugar.
That protocol deals with the transitional period from 1st January, 1973, until 28th February, 1975. With regard to other food imports, the Minister is having a phasing in of increased prices so that the inflation on the housewife will be tapered and will not come to full effect until the end of the transitional period. But with sugar, the effect will be felt immediately in the transitional period.
At the moment, sugar in the shops is 9p for two pounds. This means that, on

entry, the price of sugar for the house wife will be doubled—

Mr. John H. Osborn: No.

Sir Robin Turton: Yes, doubled. What hon. Members do not realise—I had to correct the right hon. Member for Workington because he was out of date—is that since we last talked about sugar, there has been an uplift of price. When I was quoting a figure of the target price of £103a ton and an intervention price of £98·81 per ton, I was quoting figures given in April to my hon. Friend the Member for Devizes by the Minister of Agriculture. In other words, with the last price increase agreed by the Community—since Friday the price will be higher still—[An HON. MEMBER: "More than doubled."] Of course. The basic figure at the moment on the London market is about £60 a ton. This will raise it.
Paragraph 3 of Protocol 22 provides that the price should not be less than the Community price; and paragraph 2 provides for special levies equal to the difference between the c.i.f. equivalent of the agreed purchase price and the price at which sugar is marketed in the United Kingdom, and also a charge based on the difference between the world c.i.f. price of raw sugar and the c.i.f. equivalent of the agreed purchase price. These paragraphs will mean that the price of sugar to the housewife on entry will be doubled.

The Minister of Agriculture, Fisheries and Food (Mr. James Prior): As my right hon. Friend has dealt with both those points, perhaps I had better wait until the winding-up speech—[HON. MEMBERS: "No."] All right; I shall deal with it now. As I have so many points to deal with later, perhaps it would be a good idea to clear this one out of the way.
The range of price at present operative in the United Kingdom is £82 to £92 per ton, and not the £60 per ton which my right hon. Friend has mentioned. The mid-point at present is £87. This would be £97 if it were not for the special subsidy which this year we are giving to the sugar industry in order to try to hold down prices.
The Community price is at present about 11 per cent. higher than our price


would have been if I had not put in those special measures, or 24 per cent, higher than it is following the introduction of the measures.
We have a five-year transitional period to come up to Community prices. What it means in terms of retail prices—the important point about which right hon. and hon. Members wish to hear—is that retail prices in the Six are substantially higher than they are in this country; anything between 35 per cent. and 70 per cent higher—not 100 per cent. higher. The difference is basically due to the efficiency and, therefore, the cheapness of our distributive system and to the fact that retailers here have traditionally reckoned to make very little out of selling sugar. Consequently, I would expect the increase in retail prices, other things being equal, to be of the same order as the increase in the wholesale price of sugar. This I have already said would have been 11 per cent., had I not taken the measures on 8th March, but would be 24 per cent. allowing for those measures.

Sir Robin Turton: I am most grateful to my right hon. Friend. It is very helpful that he has given us this information. I do not want him to intervene again, but I presume that he will not be able to continue the present subsidy once we enter the Community, because that is against the Treaty of Rome. Therefore, it will mean an increase, according to my right hon. Friend's figures, of 24 per cent. But, in addition, under paragraph 3 of the Protocol there is no phasing-in. That is what I am objecting to. It is not a phasing-in. Directly we get in, we are not allowed to have sugar on sale at a lower price because we must not prejudice the marketing of Community sugar. That is what we have agreed to. I wish that we had not agreed. I did not realise that we were adopting for sugar a different policy from other foodstuffs.
I hope that my right hon. Friend will give some rather more satisfactory answer to the housewives of Britain. What will happen if before we enter the Community there is another price review of the common agricultural policy and a further uplift of prices? These figures are for the year 1972–73, the current agri-

cultural year. What we shall be facing in 1973 are the 1973–74 prices, which may be higher.
I take comfort that my right hon. Friend considers that my figure of a doubling is excessive. But I am still worried about housewives having to pay, on my right hon. Friend's estimate, prices at least 24 per cent. higher. I believe that my right hon. Friend is optimistic.
For those reasons, I hope that the Government will look favourably on one of these Amendments. I do not know which one would be easiest for the Government to adopt. But in the interests of British housewives, and in the interests of Australia and particularly our sugar producing Commonwealth countries, it is vitally necessary that something should be put into the Bill to give them a degree of confidence for the future.

5.15 p.m.

Mr. Nigel Spearing: The Father of the House has, with his characteristic clarity, outlined the political background to the Amendments. As one or two hon. Members on the Government benches do not seem to be aware of the full significance of what we are debating, I hope to put briefly certain points which have not yet been mentioned. I am very glad to do this because in a previous debate there was some discussion as to how far the European Economic Community was an outward looking world-oriented organisation, and it has been sometimes stated by the proponents of the advantages of joining the Community that that is so.
I am not trying to be funny when I say that sugar is an acid test in this respect. Hon. Members on the Government benches have already pointed out the great extent to which sugar forms the inherent and basic economy of so many of our Commonwealth territories. I am glad that the hon. Member for Lewisham, West (Mr. Selwyn Gummer), is present in the Chamber, because we clashed on this matter in a previous debate and I said that I hoped that he would be present when I made these points in this debate.
First, I should like to describe—I am open to correction from the Minister if my figures are wrong—something of the mechanism operating at present. As I understand it, the Community has a sugar


surplus of between half a million and 1 million tons annually over and above its current consumption. I shall explain later how this came to be so. But it is not surprising to know that, by and large, the great mass of this surplus is grown in France. This, perhaps, is explained by the natural background of that country and the degree to which some parts of France are particularly suited to sugar beet production.
As I understand it, our deficit is about 1,800,000 tons. As we have heard, there is a marked difference in price through our support arrangements and quota system for farmers. I add for the benefit of the interest group of the right hon. Member for Thirsk and Malton (Sir Robin Turton) that the British farmer is also interested in this matter, and it may not be as sweet for him as perhaps some people have thought. Therefore, we have a great imbalance in price. The figures have already been quoted. I think that the Minister said that it would be about 70 per cent. in retail terms at the end of the transitional period.
Why is the European surplus so great? It is because in world terms sugar is a tropical crop. As I understand it, in 1961 when the sugar arrangements were introduced under the common agricultural policy the Community agreed to calculate basic quantities. That was done on the years 1961–62 to 1965–66. The Community calculated a basic production quantity of some 6½ million tons. But this estimate of European consumption was rather too high. However, once having handed out the quotas to individual States, and individual States having handed out the quotas to individual factories, and individual factories having given quotas to farmers delivering to those factories—a procedure well known to many hon. Members on the Government benches who represent agricultural constituencies; because we work basically the same system—the Community then found that irrespective of the yield, which was probably under-estimated rather than over-estimated, this very marked surplus resulted.
One must bear in mind that in doing this the Community was attempting to produce a free market in sugar—a very difficult thing to do in view of the way in which this process works and because of a quota from country to country as a

ceiling quota anyway. The basic quotas were given a guaranteed price. In other words, farmers whose sugar factory was producing quantities up to the quota which it was given could get the guaranteed price at the market price level.
It would be right to describe in detail from an authoritative source exactly what happens. If the Committee is not interested, I am sure British farmers will be interested, because the same system, I take it, that exists in Europe will exist here shortly. I quote from "Green Europe", published by the Agra-Europe Group. It is a fortnightly bulletin for British farmers. The issue of 5th February, 1971, says:
The Common Market farm fund will guarantee this intervention price for all sugar produced up to five per cent above the estimated quantity for consumption in the Community."—
that is, of course, already over-estimated to begin with—
And the member states, which have given their factories basic quotas of sugar, are at present committed to paying the full intervention price for all sugar offered to them up to 135 per cent of these basic quotas with funds provided from FEOGA. This ceiling, known as the maximum quota, is due for revision this year.
This extra 35 per cent of production, although it qualifies for the intervention price, is not straightforward profit for the sugar factories because they have to pay a levy back to FEOGA for production above their basic quotas. The size of this levy is calculated from a formula based on total EEC production, and on price levels within the Community and on world markets.
Once the intervention agencies have bought up sugar with FEOGA funds, they can either resell it on the Community market at a price above the intervention price, or they can denature it and sell it cheaply for animal feeding stuffs or chemical uses, or they can sell it at the world market price for export to non-member countries. Production over the 135 per cent mark cannot be sold on the Community market and has to be exported at world prices.
The rules which apply to the price structure for white sugar are reflected in the guaranteed prices available for producers of beet. No target price is fixed for beet, but there is a guaranteed minimum price of 7s. 2d. per cwt. which is calculated back from the white sugar price. It applies to beet of 16 per cent sugar content, delivered to the factory within the basic quota.
Between basic quota and maximum quota (100–135 per cent) there is a lower minimum price of 4s. 3d. per cwt. Beet produced over and above the quota qualifies for no guaranteed minimum price. It is the sugar manufactured


from this surplus beet which cannot be sold on the Community market.
So the production discipline which the three-tier price arrangements impose on sugar factories is passed to sugar beet growers. They are put under further pressure because the levy on over-production (mentioned above) which the factory has to pay is split60: 40 between producer and processor; it is the farmer who has to pay the larger part of the penalty for overproduction.
I intervene at this point to say that we are told that the CAP is to help the farmer. But here we are shown that the farmer who over-produces is penalised and the factory and the manufacturer, presumably, get the profit.
I continue—
The minimum prices for sugar beet are fixed on the basis of the intervention price for white sugar, allowing for the processing margin, yield, receipts from the sale of molasses and the cost of delivering beet to the factory.
Because the Community prices were fixed from the usual political compromise, they were extremely generous for the more developed beet growing areas. The minimum price within the basic quota represented an increase of 40 per cent for the French beet grower betwen 1966–67 and 1968–69—hence the considerable increase in production within the Community.
I have no doubt that hon. Members are completely foxed and wearied by this long quotation. But it is right to read it because it is simple compared with what happens. There is nothing here about a percentage of sugar in the beet. There is nothing about how the farmer will compete with his neighbour, and there is nothing about how one sugar-producing factory will compete with another, which is the essence of the system. It is far more complex than even the document I have quoted makes out. I have shown that a system which we are joining has an in-built surplus because of the nature of the political compromise necessary to start the system up. I hope I have now come to the point of the long quotation.
This is why it is politically very expedient for the Community to make sure that there is a market for the surplus under the system. As far as I can understand, it is a system which it is unable to change. In 1969–70 £36 million of Community funds went to support sugar prices internally. The Committee can now see just how crazy the system is. But it is even crazier. Included in the French quota, which is the largest of the

quotas in the Community, and which amounts to about 2,400,000 tons, is 465,000 tons as the quota for Guadeloupe, Martinique and Réunion, which are parts of overseas France and, therefore, for the purposes of sugar calculation are part of Europe. They are producing cane sugar in the West Indies which is regarded as beet sugar grown in Europe. Good luck to them. The French have done well by their West Indian territories, but neither the Chancellor of the Duchy nor the Minister of Agriculture has said what they have done for our West Indian territories.
If the French found it necessary to make a special arrangement for their territories and to have a quota for the West Indies built into the European system, surely we could have done something similar. Surely it would have been only justice to have said in the negotiations that we wanted a comparable system to the French. The French are now having it two ways. They not only have a guaranteed market for their West Indian producers; they also have a surplus production by their own domestic producers, and production has therefore risen very rapidly in the last two years.

Mr. William Molloy: Would my hon. Friend not agree that this is all part and parcel of the terms of surrender and the price that we are having to pay for entry We are not only letting down producers in this country, but we are letting down Commonwealth producers who have assisted us in years of stress and strain, and that is a shameful thing to contemplate.

Mr. Spearing: I fully agree with my hon. Friend but even he has not understood the extent to which we are letting them down. That is my next point. I am glad to see the Chancellor of the Duchy has returned, and if I am wrong I hope he will intervene.
We have made no such similar arrangement for our West Indian territories. As the right hon. Member for Thirsk and Malton has explained, cane sugar requires some degree of certainty because of the replanting cycle of 5–7 years. We are often told, and I am quite sure that the hon. Member for Lewisham, West, will agree, that trade and aid require stability. The guarantees contained in the Commonwealth Sugar Agreement for the


Commonwealth sugar producers were perhaps a model of world trade in this respect. That agreement seems to be on the verge of disruption.
It is impossible for any primary producer to plan ahead if the world market price is going to shoot up and down. He can make no plans because of the lack of stability, and he cannot depend upon a fair price, the old mediaeval idea of a just price, which is believed by everybody to be in the best interests of world trade. We are scrapping a system and we are disrupting that trade that remains. As part of the European sugar system, surplus sugar must be used either for feeding stuffs or it must be put on the world market at world prices which are well below the European prices. Not many years ago a million tons of sugar was dumped by EEC producers on the world market, and such a move plays havoc with world prices.
Not only are we busting up the Commonwealth Sugar Agreement, which gave guarantees to primary producers in countries where sugar was the major, and in some cases virtually the only, export crop. We are also ensuring that the market which will be left to them will be subjected to an avalanche of European sugar which will make conditions even more unstable.
5.30 p.m.
When we talk about the matter we talk not only about our Commonwealth but, in my case at least, about some of our constituents. Many of my constituents come from the West Indies, and many of them hope to go back there. Many have relatives there and will be trying to obtain better jobs or to work longer overtime in this country because of the destitution which already exists there and which will no doubt become even worse as a result of the sort of arrangements we shall be entering into very shortly if the Government have their way.
Where did the £36 million spent in 1969–70 to support sugar prices and to dump over 1 million tons on the world market come from? It came from levies on imported foods, again from the pockets of the housewife. It is a vicious system, contrary to everything that is said about the need for aid and world trade.

That is why not so long ago I challenged the hon. Member for Lewisham, West to say why in this respect the EEC was an outward-looking and world-conscious community. On the very commodity where it could have played a great part in helping the rest of the world to maintain, if not increase, economic standards, it has chosen not to adopt a system to help. The system adopted is directly contrary, one which is almost mad financially and which appears to be mad in human terms. Some might go further and call it bad, if not evil.
No one has so far quoted in this debate the words of Part III of Protocol No. 22 in the Treaty of Accession. I hope hon. Members will compare these words with the system I have just outlined:
The Community will have as its firm purpose the safeguarding of the interests of all the countries referred to in this Protocol whose economies depend to a considerable extent on the export of primary products, and particularly of sugar.
The question of sugar will be settled within this framework, bearing in mind with regard to exports of sugar the importance of this product for the economies of several of these countries and of the Commonwealth countries in particular.
Having signed a treaty including that protocol, and bearing in mind the system I have outlined—no hon. Member has denied that that is how it works—the Government should be only too glad to accept one of our Amendments. That would underline everything we have heard about the Community's outward-looking, world-wide mission and its responsibility to those less developed countries which are absolutely tied to one primary product. It would also put into legislative form the aspirations of the Chancellor of the Duchy of Lancaster when he signed the treaty of which that protocol was part.

Mr. Shore: On a point of order, Miss Harvie Anderson. Might not it be helpful to all of us if we had a reply from the Government rather in advance of the winding-up speech at the end of the debate? If we were not under a guillotine we should normally be able to make points and then return to them. Everyone who has heard the debate will agree that such substantial points have been made on both sides in the seven speeches already that it would be very welcome if the Minister replied and we then had the


opportunity to pursue matters a little further. It would be convenient for everyone for the Minister to have a second bite if necessary.

The First Deputy Chairman: The right hon. Gentleman will be aware that that is not a matter for the Chair, but no doubt his words have been heard.

Sir George Sinclair: I agree with one of the major points made by the hon. Member for Acton (Mr. Spearing), that the question of sugar imports from the developing countries of the Commonwealth is an acid test of Britain's relationships with the developing world. It is of basic importance to many hon. Members on both sides. It will be a test also of the relationship between the enlarged EEC and the third world.
We gave guarantees at Lancaster House which were accepted by the Sugar Producers Association and the Governments of the sugar-producing developing countries. They were accepted by Her Majesty's Government as a basic obligation. The question we have been debating this evening is how far the guarantees we gave unilaterally have been accepted by the enlarged EEC and, in the long term, how far they will be acceptable to our fellow Members.
Let us look at the situation as it is affected by different interests. There are strong forces ranged against the maintenance of imports of sugar from the Commonwealth producing areas. First, there is the increasing production of sugar beet in other European countries. Secondly, there is the pressure within Britain for increases in the efficient production of beet sugar by United Kingdom farmers. It is, in the light of the present prices for United Kingdom farm products, the best-paying break crop for large-scale corn growers, especially in East Anglia. There is also heavy capital investment in Britain in the efficient processing of this crop. Of course, radical changes upwards in the market prices for other agricultural products, such as beef, might make another break crop such as grass competitive. But we are dealing with the present situation.
There are powerful influences in favour of home production, both in Britain and in Europe, among the farmers and among those who have invested in sugar pro-

cessing. They will seek to use their influence in favour of the industry in which they are engaged and against the import of sugar from the developing Commonwealth countries.

Mr. Alfred Morris: I believe the hon. Gentleman signed an early-day Motion that said a firm agreement with the Six on the question of sugar must be a precondition of entry. Is that still his position?

Sir G. Sinclair: I shall make that point in my own way. In nearly every speech I have made in this Chamber I have supported the cause of the developing countries. In this, my concern has been for two things. One is the cause of the developing countries and the other is Britain's good name in its relationship with those countries. They are both important to Britain.
Until the sugar producers in these developing countries can find an alternative export crop which will give them as good a return in foreign exchange as the production of cane sugar, we have an obligation to help them continue to market their product.

Mr. Richard Body: Vote for the Amendment then.

Sir G. Sinclair: My hon. Friend the Member for Holland with Boston (Mr. Body) says that I should vote for the Amendment. There are many ways of giving support to the developing countries apart from voting for Amendments. I do not support the Amendment.
I do not believe, as some people have suggested, that aid is any substitute for providing access at reasonable terms to the markets of the developed world. I am sorry that we are not to have a Foreign Office Minister winding up this evening because our obligation over sugar from the sugar producing countries of the Commonwealth affects our relationship with those countries; and this is the concern of the Foreign Office. This relationship is not really the responsibility of the Minister of Agriculture towards the British farmer.
The Government gave honourable assurances at the Lancaster House conference. Taking into account the limited degree of acceptance of these assurances by the EEC so far and the in-built forces


within the United Kingdom and other parts of Europe working for the expansion of the beet sugar industry, we shall look for heavy reassurances this evening from the Minister about the future of the guarantees given unilaterally by this country. This is a real test of Britain's good faith towards those countries.
My belief is that in seeking entry to the EEC we are opening up for the developing countries, or we can do so, a better future and improved access to the markets of the world. We can also help to produce a stronger aid consortium in Europe. It is for those two reasons, among others that I want to see Britain entering the Common Market. I believe it will be of benefit to the developing countries. Let us make sure that the important assurances given at the Lancaster House conference are carried through by Government policy from now on and are not allowed to become simply agreements that we have negotiated adroitly. I believe that that is not the Government's attitude. I believe that we have a real sense of responsibility towards the third world, and I look to the Minister tonight to support what was agreed at Lancaster House.

Mr. Kenneth Marks: Next week Members of Parliament and Legislative Councillors of Commonwealth Caribbean countries will be meeting for their regional conference and I wonder whether they will be as happy about EEC entry as our Government think they ought to be. Sugar is not their only worry; they have great unemployment problems; some have had difficulty with the banana crops.
Next week they will be debating the effect of our entry on their countries and particularly upon sugar. They will see, as my hon. Friend the Member for Acton (Mr. Spearing) pointed out, their neighbouring islands, which are part of metropolitan France, doing quite well out of EEC membership. The only information they will have to go on is the communiqué issued after the meeting of the heads of the developing countries of the Commonwealth Sugar Agreement in 1971.
I want to remind the Committee of what that said:
There was a full discussion of the Community's offer made on sugar after 1974.

Many of us would have liked to have heard that discussion in full.
The British delegation assured other delegations that the Community's proposals constitute a specific and moral commitment by the enlarged Community, of which the United Kingdom would be part. The British Government and other Commonwealth Governments participating regard this offer as a firm assurance of a secure and continuing market in the enlarged Community on fair terms for the quantities of sugar covered by the Commonwealth Sugar Agreement in respect of all its existing developing member countries.
The developing Commonwealth countries will continue to plan their future production on this basis, and their plans now are for long after 1974.
The final paragraph said:
While recognising that the present meeting was concerned with the arrangements to apply to the developing Commonwealth sugar producers after Britain's entry into an enlarged Community, the Government representatives stressed the importance of a continuing and vital International Sugar Agreement to all sugar-producing countries. They expressed the hope that the enlarged Community would participate actively to this end.
5.45 p.m.
Whether that hope is any greater now than it was then I do not know. Whether the Community has shown that it will take an increased interest in the developing countries, and particularly sugar producers, is questionable. There will be many pressures on the EEC countries by 1975 to think about their own sugar production and their own affairs rather than the affairs of other countries. At present there is a surplus of sugar, and I think that about 11 per cent. of the production of the Six is converted to animal foods. If we enter the EEC that surplus could come here for refining, and our friends in the Commonwealth countries will be very concerned about that pressure from European countries.
It is easy to say that we all keep to agreements. This week we are finding with monetary matters that, while the Government may have the finest intentions of keeping to agreements, if the pressures are so great that they have to break them then they break them. There is another pressure which will be operating on the EEC countries. There will be a demand to simplify all the ramifications and special relations between the Six and its former dependencies and between us and our former dependencies.


No doubt by 1975 we shall be talking much more in terms of simplified arrangements.

Mr. Alfred Morris: My hon. Friend referred by implication to Guadeloupe and Martinique. These are integral parts of metropolitan France and, as such, are in a different position from Jamaica, Trinidad and Tobago, Barbados and Guyana.

Mr. Marks: I agree. The independent Caribbean countries are in a very different position. If the associated States of the West Indies enter into a common arrangement with Jamaica as they hope to, and it would be logical, they may well lose some of their rights of association, which Jamaica does not have at the moment. The questions they will be asking next week are: Is the bankable assurance really there? Will we take as much sugar from them then as we do now? The Government can demonstrate the force of their assurance, can show their support for the Commonwealth and the priority they will give to the less developed countries, by accepting the Amendment. If they do not, then it is up to us to write in a real and bankable assurance.

Mr. J. Enoch Powell: I associate myself entirely with my hon. Friend the Member for Banbury (Mr. Marten) when he said that this debate illustrates sharply the inadequacy of the time and opportunity which this Committee has to consider the contents of the Treaty of Accession and what lies behind the Bill.
That was drastically illustrated by the two brief episodes when, first, my right hon. and learned Friend the Chancellor of the Duchy of Lancaster, and then, somewhat less reluctantly and very helpfully, my right hon. Friend the Minister of Agriculture, Fisheries and Food, were briefly brought to their feet to make interventions.
It was also illustrated by the plea of the right hon. Member for Stepney (Mr. Shore) that a Government spokesman should interpose in the course of this debate. The purpose of a Committee stage is to enable the Committee to understand the meaning and implications of the provisions of a Bill by having the

opportunity to question the Government specifically and to consider what the Government have to say. Of course, I understand the reason why my right hon. Friends are determined to defer their interventions to the latest possible moment. It is so that they cannot be questioned; it is so there shall be no opportunity to do what a proper Committee stage provides for, namely, to come back again after an explanation has been given, to examine that explanation, to discover by debate whether it is satisfactory, and then go forward from there.
The Committee is being denied a true Committee stage of this Bill by the joint operation of the guillotine, which enables the Government to avoid being questioned, and the decision that there shall be no further stage at which whatever Ministers are pleased to say at the conclusion of these debates can be further considered and debated.
There are two aspects to this undoubtedly important part of the treaty and of the Bill which are under consideration together. There is the initial period, the first two years up to the beginning of 1975, and there is the future at large after that date. Both require considerable investigation and detailed examination.
I do not know how many Members of the Committee have sought to read Protocol No. 17, which deals with the first of those two phases, in conjunction with Clause 7 of the Bill; but it is illuminating to do so. My right hon. Friend the Member for Thirsk and Malton (Sir Robin Turton) was fully justified in reminding the Committee that, up to that point of his speech, we were altogether overlooking Protocol No. 17 and the first or initial phase. I should like to draw the attention of the Committee to paragraph 5 of Protocol No. 17, which says:
The Council shall, acting by a qualified majority on a proposal from the Commission, adopt the measures necessary for implementing the provisions of this Protocol".
Then it continues:
in such a way as to ensure the proper functioning of the common organisation of the market in sugar and in particular to ensure that … the price at which the sugar is marketed in the United Kingdom is respected.
It is of importance, before this Clause is added to the Bill, that it should be


understood beyond peradventure what is meant by that not immediately intelligible expression.
The Council shall, acting by a qualified majority"—
there will be no question of our being able to interpose a veto—
adopt the measures necessary for implementing the provisions"—
that is to say, it is to implement the levies in this country—
in such a way as to ensure that…the price at which the sugar is marketed in the United Kingdom is respected.
It is important that we should know whether that means action to keep the price in this country up or down? Or exactly what does it mean?
There is a special reason for our inquisitiveness, and that is that this is the last opportunity that the House of Commons is sure of receiving to advert to this matter. Clause 7, which, after all, is the Clause under consideration, deals with the
amounts charged for the use of the Sugar Board by a directly applicable Community provision on goods imported into the United Kingdom.
So the imposition of the levies set out in the protocol and the implementation of the provisions for the first or pre-1975 phase will take place by directly applicable Community provision. Hon. Members must not suppose that they can let the matter go, on the basis that we shall be able to consider some time during the next two or three years what will be the effect on prices in this country of this or that level at which the levy may be set. The matter will be entirely out of the hands of Parliament. Therefore, we should have a proper opportunity, since this is taxation—taxation of the food of the people, one of the most vital matters—to hear a detailed ministerial explanation of the way that this will work, the effect that it will have on prices, and what is meant by that respect to the market price of sugar in this country which the Council and the Commission are to have. In short, we need be told in advance the meaning behind Protocol No. 17, so that at least we can, as the months and years go by, watch whether the behaviour of the Council in implementing that protocol by qualified majority agrees with what we had been told before we joined. We deserve a whole debate upon Protocol

No. 17, after there has been a full explanation on behalf of the Government.
However, there is no doubt that the major matter before the committee is what is to happen after 1975. We all share the sense of obligation which was so well expressed, if he will forgive my saying so, by my hon. Friend the Member for Dorking (Sir G. Sinclair). We have all read the words—they have been read several times already—in paragraph 112 of the White Paper of July, which set out the British Government's position. I make no apology for repeating them. The paragraph reads:
The British Government…regard this offer"—
that is the offer in Protocol No. 22—
as a firm assurance"—
a firm assurance of what?
of a secure and continuing market"—
that is, without limit of time—
in the enlarged Community, on fair terms"—
for how much sugar?—
for the quantities of sugar covered by the Commonwealth Sugar Agreement".
That is to say—and it is very precise—that the Government regard Protocol No. 22 as meaning that for an indefinite future there will be a secure and continuing market on fair terms for these exact quantities of sugar. In case there was any loophole they went on to add,
in respect of all its existing developing member countries.
One could hardly have tied it up more tightly than that.
That is the British Government's understanding. From that statement with its clarity, precision and definiteness, from that guarantee, we turn to Protocol No. 22. There we find no more than the vaguest possible expression, an expression without any detail or quantification whatsoever.
The safeguarding of the interests of all the countries referred to in this Protocol";
and it continues: "the question of sugar"—a very precise expression, to be sure—
will be settled within this framework".
There is nothing in that protocol which implements the Government's understanding or undertaking and there is nothing which justifies the confidence which the Government profess.

[Mr. BRYANT GODMAN IRVINE in the chair]

[MR. POWELL.]

6.0 p.m.

This can be counter-checked from the treaty itself. It is not only in connection with sugar that the question arises: what is to happen after the initial period? That question also arose over New Zealand butter, where there is a first phase and then a phase after 1977. The treaty itself contains a specific provision for what shall happen after 1977. Though we may not consider even those terms to be adequate, there is written into the treaty a precise indication of what is to happen after 1977. It is not something which can be overridden when the time comes, something which is vague; it is something which calls for precise action on the part of the institutions of the Community.

I want my right hon. Friend, when he winds up, to answer this question: is the assurance to the Commonwealth suger producers as firm as the assurance to New Zealand? The British Government consider it a firm assurance. Do they consider that the Commonwealth sugar producers have an assurance as firm or as good as the New Zealand butter producers? If my right hon. Friend replies "Yes", why is there not a similar provision in the treaty? If the second phase for the New Zealand butter producers could not be adequately safeguarded without the terms of the relevant protocol, why was it possible to give an equal safeguard to the Commonwealth sugar producers without anything corresponding? On the other hand, if my right hon. Friend replies, "No, there is a difference; we have done better for New Zealand than for the sugar producers", then it is not only one side of the Committee which will want to know why the interests of the Commonwealth sugar producers were regarded as less a debt of honour and a requirement imposed on this country than the requirements of the New Zealand butter producers.

Of course there is not the slightest doubt about the reason for the difference between the two. The Government insisted on a specific provision being written into the treaty regarding New Zealand butter. They did not insist—or rather, in their attempt to insist they failed—upon a similar provision being written in for

sugar. The history, of which my right hon. Friend the Member for Thirsk and Malton reminded the Committee, makes that perfectly clear. The fact is that there is no corresponding, adequate or precise guarantee on the part of the Community for the Commonwealth sugar producers after 1975; and the Government know it.

We are often exhorted in these matters to have regard not to the letter but to the practice. We are told not to be too nice about the letter of the treaty but to look at how people actually behave. That is a rather painful proposition, this week of all weeks, for my right hon. Friends, who find themselves in the position of having been in breach, admittedly not of a provision of the treaty, but of a firm understanding, designed to lead to an even tighter arrangement within the Community itself, which they threw over on Friday last.

However, we have had some evidence lately of how the members of the Community regard that which is actually written into the treaty. I think it is material, in the interpretation of the vague words of Protocol No. 22, Part III, to understand how cavalierly much more precise provisions of the treaty can be regarded by the members of the Community. In that context, and for that purpose only, I think there should be recorded what we have learned recently about the attitude of one of the Community Governments, the French Government, to the New Zealand guarantee in phase 1—corresponding, it will be observed, to phase 1 of the sugar arrangement and drawn much more tightly than phase 2 even in regard to New Zealand butter, not to mention Commonwealth sugar.

One of the French Ministers was in the South Pacific and found himself extremely irritated by the action taken by certain trade unions in New Zealand in view of the proposed French nuclear tests. He said that, if this sort of thing went on,
his country—France—would cut New Zealand's five-year guaranteed period of exports to Britain under the Market entry deal.

When I saw that in the Press, I could not believe it. I did not credit that such a statement could have been made by a responsible member of one of the Community Governments. So I sought contradiction from the most interested party,


the New Zealand Government; and the New Zealand High Commission told me, in writing:
M. Messmer was in fact correctly reported.
He had said it, and the New Zealand Government knew that he had said it. But they said they were not worried because
the French Foreign Ministry has indicated to the Press that M. Messmer's statement does not reflect French Government policy.
One would think not. But I felt this was such an important matter that it was my business to be sure. So I turned to the French Embassy, only to be assured, two or three days ago, again in writing, that the French Embassy had
no knowledge of any comment by the Ministry of Foreign Affairs concerning the statement attributed to M. Messmer".

We do well to note a statement concerning one of these transitional provisions in the treaty, that, if necessary, it will be abrogated or neglected by one of the participating countries—a statement which the country concerned confirms has actually been made and which has not been disavowed by the Government to which the Minister who made it belongs. We ought to be chary of over-generosity in assuming that vague expressions in a protocol will be treated, years ahead, in the precise manner which, no doubt in entire good faith, my right hon. and learned Friend interpreted and put it before the House in the White Paper of last July.

My reference to the White Paper of last July brings me to my last point and to my hon. Friend the Member for Flint, West (Sir A. Meyer), who interrupted the hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) to remind him of the majority of 112 last October which voted in favour of entry into the Common Market upon the terms negotiated. My hon. Friend seemed to think that was a reason for voting against these Amendments. With respect, it is a very strong reason for voting for them.

I suggest that hon. Members who, on 28th October, voted "Aye" for the proposition are, I go so far as to say, duty bound to vote either for these Amendments or for something which would have the same effect; for what they voted for on 28th October was the terms nego-

tiated, as set out in the White Paper. They had not seen the treaty; they had not seen the Bill—those still lay in the womb of time—but they had the White Paper. So what they voted for were the precise undertakings to the Commonwealth sugar producers set out in that White Paper. They did not know that they would not be in the treaty; they did not know that there would be nothing in the Bill to secure them. They voted in good faith on what the White Paper says. They voted in effect, amongst other things, for what this Amendment would achieve. No, there is no hon. Member of the House, whichever way he voted last October, who is not free to address his mind to this question and who is not, in my view, bound in duty to those to whom our Government have given an assurance, to make as certain as we possibly can by Statute in this House of Commons that that assurance is going to be carried out.

Mr. Eric Deakins: The right hon. Member for Wolverhampton, South-West (Mr. Powell) has a remarkable capacity for detailed analysis which has served this Committee well in the past and on this occasion he has drawn attention to a number of anomalies as between the treaty and the public statements that have been made about the sugar agreement which should give all of us in the Committee, regardless of our views on the Common Market, cause for concern. I hope to follow his lead a little later in my remarks, which I shall certainly make fairly brief.
I want to begin by commenting on the fact, which has not been fully emphasised in the Committee this afternoon, that we are discussing not simply sugar but sugar as an agricultural product. We are in fact discussing an agricultural product which is part of the common agricultural policy of the European Community. In considering the attitude of the Community to sugar production, imports from the developing countries and so on, the good faith of the Community in these negotiations has been called in question, but we have to consider the general attitude of the Community to all agricultural questions which affect the interests of agricultural producers in Western Europe.
We know from experience—not from the letter of the law but from what has actually happened in the past 10 years in the Community—that the common agricultural policy is basically a policy for each commodity which in its very nature gives priority to satisfying the domestic market from home production, with imports being allowed to come in, subject to levies and so on, to meet any particular deficiencies, while European producers are expanding their production of those commodities in which the Community is not at present self-sufficient.
If we look at sugar and the sugar negotiations in that light it becomes easier to see why there are the anomalies, difficulties and misunderstandings about the Commonwealth Sugar Agreement and its part in the negotiations to which the right hon. Gentleman and other hon. Gentlemen in this debate have drawn attention. It is a fact and it is very sad, particularly in the case of sugar, that whereas for some agricultural commodities it could be said that Community production is not very much less efficient than that in the rest of the world, as regards sugar the Community is very much a high-cost sugar producer. Not only that, but it is also a very inefficient sugar producer because basically sugar beet in the Community is grown on marginal land and is grown as a break crop from cereals. Therefore it is not the sort of agricultural commodity that is regularly grown, such as cereals, or produced, such as meat and dairy products, which have formed the basis of the common agricultural policy.
This inefficient production has cost the European Community a great deal of money and will cost it even more in the future. At present the exporting of sugar and domestic intervention in buying any sugar which is produced above the minimum quota but below the maximum costs the Community something like 8 or 9 per cent. of the total agricultural budget. That is a very large amount indeed and it is something to which, since we shall be contributing to it, we should have regard in these discussions.
Furthermore, the Community has adopted, is adopting and will continue to adopt, I think, a pig-headed policy to

world trade not only in agricultural products but to sugar in particular by refusing to join the International Sugar Agreement and dumping surpluses on world markets. This will create an even more serious situation in future with the 335,000 tons of Queensland sugar coming on to the world market in 1974. If the Community continues to pay export subsidies these will be much bigger for 1974; therefore our contribution will also be much bigger and it is inevitable that the whole of the International Sugar Agreement will be called in question.
6.15 p.m.
The enlarged Community would in fact be a non-importer of sugar and as long as we have these vague assurances for the Commonwealth sugar producers the Community will have to continue to export surpluses of sugar because they cannot export them here since we shall continue to take quantities under the Commonwealth Sugar Agreement. It has been pointed out by the hon. Member for Dorking (Sir G. Sinclair) and my hon. Friend the Member for Manchester, Gorton (Mr. Marks) that the pressures within the Community to abrogate that agreement and sell the sugar producers down the river will grow and grow. They will be financial pressures and economic pressures and they will get stronger in the future. The signs can be seen already.
I do not wish to give many quotations but I should like to quote one prominent French agriculturist who was a past president of the Fédération Nationale des Syndicats ďExploitants Agricoles, which is the nearest thing the French have to the NFU. He said in an interview in the magazine NFU Insight on 25th March, 1972:
What worries me is the thought that some aspects of these negotiations have been dealt with rather superficially. The negotiations may well have left the door open to claims which, in future years, may provoke a Common Market crisis. I am thinking particularly of the arrangements made for sugar and for dairy products.
Coming from a Frenchman and even more important a Frenchman who is an agricultural producer, and representing their interests, that surely bodes ill for the future of the vague assurances that have been negotiated by the Chancellor of the Duchy of Lancaster.
I turn now to the effect on British consumers, which has already been alluded to in this debate. We are told that sugar prices over a five-year period will rise by only 24 per cent., which is the current difference between the wholesale price of sugar in this country and that in the Community. This is a slightly illogical argument unless it can be stated and evidenced by statistical proof that a more efficient distribution system does in fact exist in this country. It may be that the Minister of Agriculture is very pleased to think that there is a more efficient distribution system in this country, and I am not denying that there may be, but he has presented no evidence that there is a better distribution system here than in the Community. In the absence of such evidence it is surely more probable than not that the rise in retail prices will be of the order of 50 to 60 per cent., being half way between the 35 per cent. and 70 per cent. figures the Minister quoted in an earlier intervention.
In fact, we have a good system of sugar production in this country from the point of view of both producers and consumers and imports. I have made this point and do not want to labour it, but this is part of our present system of agricultural support which does not undermine the interests of developing countries exporting to this country or affect the housewife adversely. Why, therefore, should we swap a good system which works for a much worse one?
I come now to the most important point, which has been alluded to by many right hon. and hon. Gentlemen in the debate, of the actual negotiations. Surely in the negotiations the ideal solution would have been to restrict Common Market sugar-beet production to its present levels and assuming that it was absolutely necessary to exclude Queensland from any concession—hon. Members have made their points about that—why could not the Queensland sugar quota of 335,000 tons have been divided up among all the Commonwealth developing States in addition to their quotas under the Commonwealth Sugar Agreement? That would have meant that they would no longer be in a position in which, if they had surpluses over and above their quotas, they would have to dump them at low prices on the world market. We would be helping the developing countries far

more by some such solution than the one we have at the moment.
I turn now to the main point made by the right hon. Member for Wolverhampton, South-West: what is to be the position in 1975 and thereafter, particularly if we should find ourselves in difficulties with our Common Market partners? I am sure that hon. Members on both sides of the Committee will accept that the British Government have pledged their word, and none of us has any reason to doubt that that word was given in good faith and that any future British Government will do their utmost to see that the pledge is honoured, because we have at stake not only our national interest but our national honour as well. What will happen, however, if we find that we cannot go on after 1975 by agreement with the Community with the existing quantities and prices of Commonwealth sugar under the Commonwealth sugar quotas? Are we nevertheless to continue? Are we to say to our European partners "We are sorry but we cannot agree with you. You want to reduce Commonwealth sugar imports into Britain and the Common Market, but we insist that they go on as they are"?
I ask the Minister whether in that situation we would be in breach of our treaty obligations if we insisted on the Lancaster House agreement root and branch with no alternative. What will be our position in 1975? Under Protocol No. 22, the Community has
…as its firm purpose the safeguarding of the interests…
of the Commonwealth sugar countries. It is interesting to note that the words used are not that the Community will have as its firm purpose the safeguarding of the imports of sugar from Commonwealth developing countries. The protocol says that it will merely "safeguard" their interests.
As we know from bitter experience, the definition of any nation's interest, particularly by a third party, is a matter on which there can be a great deal of contention. I would not regard that "firm purpose" in Protocol No. 22 as one which would in any way have satisfied the Commonwealth sugar countries. Protocol No. 22 also refers to the African countries associated with the Common Market as well as our own Asian and Caribbean


sugar producers. The Yaoundé Convention excludes common agricultural products such as sugar. Therefore, what hope is there for us that, if sugar and other agricultural commodities are excluded from the Yaoundé Convention, they will necessarily be taken full care of in any negotiations for the renewal of Yaoundé-type association agreements after 1974?
I want now to turn to the text of what the Chancellor of the Duchy of Lancaster said on 21st July last year. He said that the Government had obtained
a firm assurance of a secure and continuing market in the enlarged Community for the sugar exports of the developing countries".
I query whether the Government have in fact obtained that firm assurance. The right hon. and learned Gentleman went on to say:
we have written into the record of the conference the understanding of what that agreement means in practical terms."—[OFFICIAL REPORT, 21st July, 1971; Vol. 821, c. 1589.]
He did not use the words "our understanding" because that would have given a great deal of opportunity to my right hon. and hon. Friends to fire shots at him because he then would have been giving only our understanding. Does the word "the" in that context mean a general understanding, or is it merely a euphemism for "our understanding" and not the Community's understanding?
I come now to the biggest point of all. We were told throughout the negotiations, particularly at the conclusion, by the right hon. and learned Gentleman that the Community had noted the text of the Lancaster House agreement. But there was a change in Government policy because later the Minister of Agriculture went rather further. Last April my hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris) when putting a supplementary question asked the Minister:
Is the Minister prepared now to seek ratification with the EEC of the Lancaster House agreement with the Commonwealth sugar producers?
The right hon. Gentleman replied:
The Lancaster House agreement was accepted by the EEC."—[OFFICIAL REPORT, 18th April, 1972; Vol. 835, c. 217.]
I do not claim to be an expert on English but there is all the difference in the world

between the Community "noting" the agreement and "accepting" the agreement.
On the basis that a later Government statement must be taken as being more authoritative than an earlier Government statement, will the right hon. Gentleman confirm what he told the House in that reply on 18th April? If he does, the rest of this debate will probably be superfluous because that is precisely what we are asking for and the Government should accept the Amendment because it would be in accord with what the right hon. Gentleman said in April. I hope that the right hon. Gentleman will clear up this misunderstanding in the Committee as to whether the text of the Lancaster House agreement when it was read into the record of the negotiating conference last year was "noted", as the Chancellor of the Duchy of Lancaster originally told us, or whether it was "accepted", as the Minister of Agriculture told us later.

Mr. Prior: I want to refer at once to the last point raised by the hon. Member for Walthamstow, West (Mr. Deakins). In answer to a supplementary question on 18th April I used the word "accepted" instead of "noted". I should have used the word "noted". As the hon. Gentleman himself said, it might well be argued that there would have been no reason for our debate today if that was indeed our final view, but I must apologise to the Committee for having misled the House in that reply on 18th April. I do not think that there was any real feeling that I had misled the House but I apologise for the slip.
I recognise that this has been a very important debate and that the views expressed are strongly held, in many cases with passion and great emotion. I do not under-estimate the enormous contribution that the Commonwealth Sugar Agreement has made to the developing countries of the Commonwealth and for that matter to the prosperity of Queensland as well. I accept what my hon. Friend the Member for Dorking (Sir G. Sinclair) said when talking about our obligations to the developing countries, and I certainly agree that trade is better than aid. Furthermore, I think that this is a real test of Britain's good faith and for that matter of the Community's good faith as well. My hon. Friend asked


whether I fully accepted and supported what was agreed at Lancaster House. Of course I do and I shall have more to say about it.
The hon. Member for Penistone (Mr. John Mendelson) claimed that the Commonwealth Ministers expected that the Lancaster House Declaration would be put before the Six with a demand that they accept it and write it into the treaty. That was not the conclusion of the conference. The text of the declaration—which was published in HANSARD on 9th June last year—said:
On this basis, Commonwealth Ministers agreed to accept the Community's proposal and stated that they would proceed accordingly, it being further agreed that Mr. Rippon would so inform the Council of Ministers of the European Community…and would communicate to the Community the text of the agreed statement.
The Governments of the Commonwealth countries could thus not have been under the impression that the declaration would be written into the Treaty.
6.30 p.m.
My right hon. Friend the Member for Thirsk and Malton (Sir Robin Turton) felt that paragraph 3 of Protocol No. 17 meant that we would adopt Community prices right at the start of the transitional period. I assure him that that is not so. The provisions in the Treaty of Accession for compensatory amounts permitting prices in the acceding countries to be lower than in the Six apply to sugar as much as to any other products. This also deals with a point made by my right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell).
Paragraph 3 of Protocol No. 17 deals with the price at which United Kingdom refiners receive the raw sugar purchased under the Commonwealth Sugar Agreement. That price must clearly be in the right relationship to the intervention price for refined sugar in the United Kingdom. If it is too low in relation to that price the marketing of Community sugar could be prejudiced. If it is too high it will not allow the quantities in question to be effectively marketed. The expression "Community sugar" in paragraph 3 means sugar produced in the United Kingdom—in other words, our own sugar beet, the price of which is being raised over the transitional period—as well as sugar produced in the Six. It is an assurance to us that our refiners

will be given a margin which is adequate without being excessive.

Sir Robin Turton: The protocol refers to the price of "the sugar in question". It is not dealing with sugar produced from sugar beet grown at home. It refers to all sugar that is refined here and elsewhere presumably under the CSA.

Mr. Prior: It is the sugar produced within the Community, which in our case is the sugar produced here which is being raised in price as the transitional period progresses. The relationship between that price and the price of CSA sugar, which is raw sugar coming in, has to be adjusted so that the refiners can get a fair margin without getting too small or too large a margin. That is what the protocol covers.

Mr. Alfred Morris: What does the right hon. Gentleman expect the retail price of sugar to the British housewife to be at the end of the transitional period?

Mr. Prior: I will come on to that in a moment. It is a slightly easier question to answer.

Dr. John Gilbert: In an earlier exchange three sugar prices were quoted, £60, £97 and £120 or thereabouts. According to the Minister's explanation, the gap between the £60 a ton, which is the non-Commonwealth Sugar Agreement price to the Third World, and the Commonwealth Sugar Agreement price must be widened. Therefore, the benefit of the Commonwealth Sugar Agreement will be increased in its last gasp. Is it correct that on this interpretation the Commonwealth Sugar Agreement price will go up for a brief period but at the same time the world price will tend to stay at the present £60?

Mr. Prior: No, we cannot possibly tell what the world price will be. We buy CSA sugar at the price we have negotiated and we sell it in the open market in this country to the refiners at the world price, which is generally lower than the CSA price. The difference has to be charged as a surcharge on all sugar used in this country. Clause 7 changes that system because it is against the Community's practice and in its place enables us to put a charge on CSA sugar coming in.

Mr. Peart: The right hon. Gentleman has been helpful but, although I know he has taken advice about paragraph 3 of Protocol No. 17, is he sure that his interpretation is right? I agree with the Father of the House about this. Will the right hon. Gentleman look at this? I think he has interpreted it wrongly.

Mr. Prior: I am absolutely certain that I have not, but it is such a complicated provision that I am perfectly prepared, if there is a change, to write to the right hon. Gentleman, my right hon. Friend and anyone else to tell them or, if necessary, to make a statement in the House of Commons. I am absolutely certain, from the advice I have had, that what I have said is the position.
I turn now to a problem which was raised by several right hon. and hon. Members about what will happen concerning Australian sugar after 1974. Australian exports to the United Kingdom are fully safeguarded until the agreement expires at the end of 1974. It is unrealistic to suppose that permanent arrangements could have been made for Australian sugar after 1974 of the sort that have been secured for developing countries of the Commonwealth. As a developed country Australia is not eligible for the type of association agreement which has been offered to the developing countries. That is why New Zealand was treated differently in her settlement on dairy produce from the way in which the developing Commonwealth countries have been treated for sugar. New Zealand could not have had developing country status.
Despite its importance to certain areas of Australia, sugar represents only a very small proportion of her total exports. By contrast the developing countries are dependent on sugar and export earnings range up to 95 per cent. in the case of Mauritius. Even taking sugar in isolation, the importance of the CSA outlet for Australia is nothing like as great as it is for the developing countries as a whole.
Much the greater part of Australia's sugar is exported to the free world market, and it follows that Australia has a vital interest in a continuing and effective International Sugar Agreement by which the free world market for sugar is regulated. It is our policy to support the International Sugar Agreement, and we

very much hope that the enlarged Community will find it possible to join. Both we and Australia have been encouraged by the positive attitude taken by the Community on this point at the recent UNCTAD conference in Santiago where the EEC spokesman said that the EEC was ready to take part in negotiations for the new agreement in the most firm hope of being able to join it. Nevertheless we recognise that Australia could be in difficulties if her CSA quota were abruptly terminated at the end of 1974 and that the world market could in the same way be disrupted if it had suddenly to absorb this extra quantity.
Protocol No. 16 provides for action to be taken by the enlarged Community to prevent the abrupt dislocation of supplies from third countries which may result from the adoption of the CAP by the new member States. This assurance clearly extends to Australia, and sugar is specifically mentioned as a commodity where such problems could arise. Action should in our view be taken under Protocol 16 to phase out Australia's supplies to us under the CSA after 1974.

Mr. Powell: Has my right hon. Friend finished dealing with Protocol No. 17? I was hoping that he would be able to give an explanation of paragraph 5. He has referred to paragraph 3. I wonder whether he can help the Committee with paragraph 5.

Mr. Prior: I do not know for how long hon. Gentlemen on the Opposition side will allow me to speak about this.
My right hon. Friend is concerned with the same aspect of Protocol No. 17 as my right hon. Friend the Member for Thirsk and Malton. He supposed that the market price referred to in paragraphs 3 and 5 of the protocol is a price for the sugar that people eat—that is, refined sugar. That is not the case. The market price of refined sugar will be determined by the intervention price set under Articles 51 and 52 of the treaty in the same way as prices for other products. The price mentioned in the protocol is a price for the sugar purchased under the CSA, which is raw sugar. The provisions of the protocol therefore relate to the margin to be allowed to the refiners. This is at present controlled under the provisions of the Sugar Act and it is reasonable that it


should be controlled under the Community system after our accession.

Mr. Douglas Jay: Mr. Douglas Jay (Battersea, North)—rose—

Mr. Prior: I think I ought to proceed. I have an enormous number of questions to answer. I do not think I should give way, for a little while at least.
As regards the position of the French African sugar exporters and Surinam, it is widely believed—I think my right hon. Friend the Member for Thirsk and Malton implied it—thatCongo-Brazzaville and Malagasy used to have, before becoming associated States of the Community, guaranteed access for their sugar to the Community. Because they were previous colonies of France, those two countries had arrangements with France in the post-colonial period under which they received a guaranteed price for a proportion of their production. This guaranteed price, equivalent to the French internal price, was paid irrespective of the destination of the sugar. There was no right of access.
My right hon. Friend also mentioned Surinam. There was a protracted legal dispute about whether one of the protocols of the Treaty of Rome did or did not give the Netherlands the right to import up to 8,000 tons a year free of import levy. In the end I think it was agreed that it should. Surinam by that time could produce only 4,000 tons for the export trade because its own consumption had risen. I am certain it has not been able to send even that amount since that time.
The hon. Member for Manchester, Gorton (Mr. Marks) and my hon. Friend the Member for Banbury (Mr. Marten) asked how there could be room for the CSA's 1·4 million tons of sugar in the Community. It is true that the Community is a surplus producer of sugar. A figure of about 1 million tons isoften mentioned, for example by the EEC Commission. That surplus is the surplus for human consumption. A lot of sugar goes into exported foodstuffs, into animal feed or into the chemical industry for example. Some of it is sugar produced above the maximum production quotas, which under the EEC arrangements must be exported outside the Community and

so could not be sent to the new member States. Thus the figure of 1 million tons is misleading. Moreover, consumption is increasing rapidly by about 150,000 tons a year in the Six alone, particularly in Italy, and can be expected to go on doing so.
Taking all those factors into account, there is every reason to believe that in the years after 1974 the Community will be able to absorb 1·4 million tons of Commonwealth sugar and also admit some overall expansion of beet production.

6.45 p.m.

Mr. Marten: Would my right hon. Friend comment on the report that the French are proposing to lay down 1,103,000 acres of beet sugar?

Mr. Prior: I know that the French beet growers were referred to. My hon. Friend quoted from the Sucrerie Francaise, which I gather is the French sugar manufacturers' journal. We are not negotiating with beet growers and sugar manufacturers who would no doubt always want to produce as much as they possibly can. But we have to negotiate with the Governments of the member States which have already committed themselves to the undertaking in Protocol No. 22.
It is not unreasonable that France might wish to expand her sugar beet production, which has gone up this year by something like 5 per cent. This will have to be renegotiated next year to operate before 1975.
Turning to the remarks made by the hon. Member for Walthamstow, West, I shall also answer the point raised by the hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) concerning retail prices. There is a very considerable difference between the retail prices here and in the Six. It is far greater than the difference between, as it were, the intervention prices. Hon. Gentlemen must realise that so far as the operation of the arrangements for supporting our own sugar beet production and sugar imported under the CSA are concerned, the consumer has always paid this. It has been a balancing charge on the consumer. It has never come out of subsidy except this year when, for the reasons which I have given on other occasions.


we subsidised through the Sugar Board to the extent of £25 million. Broadly speaking, it has always been a self-financing exercise for the CSA and the British Sugar Corporation.
At the moment our price is roughly 4·75p per pound. In the Community it varies from 6·5p in the Netherlands and 6p in France up to 7·5p in Italy, Belgium and Luxembourg. This is a far greater margin than is justified by the difference as it were in intervention prices. It reflects very favourably on our methods of distribution and refining and the fact that we take very low margins.
I now turn to the main theme running through the debate: the post-1974 arrangements. I want to say why the end of 1974 is a significant date. The Commonwealth Sugar Agreement was originally concluded in 1951 for a term of eight years, but it was annually extended by one year so that it always stretched eight years ahead. In 1966 it was, as usual, extended until 31st December, 1974. In 1967 the Labour Party applied to join the Community and believed that that application would be more likely to succeed if the Community was not confronted with a contractual obligation under the CSA lasting any longer than necessary. Consequently the previous Government refused in 1967 to make the usual annual extension. Then in 1968 it converted the CSA into an agreement of indefinite duration but inserted a break clause to the effect that the United Kingdom was not bound by it after the end of 1974 if we had by then joined the Community.
That should be borne in mind, not by those who have always been opposed to entry—because presumably they have known this the whole time—but by a good many hon. Gentlemen opposite who supported their Government when they were taking this action and are now criticising the present Government for the action we are taking. I do not say that it was wrong to make those amendments—in fact, I believe it was right. But they were made to facilitate entry into the Community in the days when Labour Members were anxious to do so.
The only assurance about the post-1974 period given to Commonwealth Sugar Agreement countries by the Labour Government in 1968 was very vague indeed.

It spoke merely of seeking to find ways of continuing to fulfil the Agreement's objectives. It has been left to us to try to put in specific assurances.
There is no reference in the Bill to the arrangements for Commonwealth sugar after 1974. The whole purpose of the Bill is to make those changes in our law which are necessitated by accession to the Community. The Commonwealth Sugar Agreement was made between the United Kingdom Government and the Commonwealth sugar exporters. It is our responsibility, and, in so far as it needs implementation, it is implemented through the law of this country.
The post-1974 arrangements, however, will not be of the same nature. They will form part of association or trading agreements between the enlarged Community as a whole and the Commonwealth countries concerned which are scheduled to begin in the middle of next year. Whatever the precise shape of the final arrangements, the enlarged Community as a whole will enact the necessary legislation to operate them. No present change in the United Kingdom law is needed to allow us as a member of the enlarged Community to take part in those arrangements.
It has been suggested that the declaration issued after the Lancaster House conference last June should have formed part of the Treaty of Accession. I have already corrected the misleading impression I gave when I spoke on an earlier occasion. The reason why the declaration does not appear in the treaty is that the Lancaster House conference did not form part of the negotiations themselves. It could not possibly do so since it was a conference between Her Majesty's Government and the Governments of the developing Commonwealth countries concerned, and not a conference between the Community and the new member States. The Community could hardly be expected to accept, as part of the outcome of the negotiations, a text drawn up by somebody else in a different form and it was never asked to do so.
At the conference last June there was a very full discussion between the Governments concerned about the undertaking on sugar given by the Community, and this appears in Protocol No. 22 of


the treaty. The Commonwealth Governments accepted the undertaking in the terms set out in the declaration. The essential phrase is that
the British Government and other Commonwealth Governments participating regard this offer as a firm assurance of a secure and continuing market in the enlarged Community on fair terms for the quantities of sugar covered by the Commonwealth Sugar Agreement in respect of all its existing developing member countries.
The fact that the declaration does not appear in the treaty does not mean that the Government are any the less committed to it. It means that we are committed to ensuring that the arrangements which the Community will make in due course for sugar from the developing countries after 1974 will accord with its terms. The Community is well aware of this since the declaration was placed on record with the Community. Considering the indisputable dependence of the countries concerned on sugar, and the recognition which the Community has given to this dependence in the wording of Protocol No. 22, we are confident there will be no problem in securing the sort of arrangements which we regard as necessary.

Mr. Jay: If the Minister is really confident that the Community is willing to carry out the agreement reached at Lancaster House, why did not the Government ask the Community to accept it and write it into the Treaty of Accession?

Mr. Prior: It was not an agreement which the Community had asked to make. It was an agreement between us and the Commonwealth sugar countries. We came to an agreement at Lancaster House that we would inform the Council of Ministers of the European Community and would communicate to the Community the text of the agreed statement. That was an acceptable assurance for the Commonwealth countries concerned. If it was acceptable to them, I see no reason why we in this Committee should doubt it.
It is a fact that the developing CSA countries are planning on the basis that the 1·4 million tons of sugar which they at present send to us will find a market in the enlarged Community. I regard that as an acceptable position and it has been accepted by them.
As the hon. Member for Wythenshawe knows only too well, he went around the Caribbean and made some statements to the effect that the Lancaster House declaration was worthless. The Caribbean Ministers rightly resented this and properly reaffirmed their acceptance of the position.

Mr. Alfred Morris: If it was right to have direct negotiations about products from New Zealand, why was it not right not to have direct negotiations to confirm the Lancaster House agreement on sugar?

Mr. Prior: I have already dealt with that problem once today in my speech. It is clearly covered by the fact that New Zealand as a developed country could not have associate status in the same way as could under-developed countries.

Mr. Marten: Will my right hon. Friend explain one very important point? If in negotiation something is put forward by all the other members of the enlarged Community which does not honour the Lancaster House agreement, will the Government veto it? Do we then fall back not to the question of derogation but to the CAP in respect of sugar?

Mr. Prior: My right hon. and learned Friend the Chancellor of the Duchy of Lancaster has already touched on this point and I thought he gave a very good answer. I see no reason for my seeking to step in on a matter with which my right hon. and learned Friend has already dealt. The essence of Community practice has always been to recognise the vital national interests of the countries of which it is composed.
To sum up, as my right hon. and learned Friend the Chancellor of the Duchy of Lancaster told the House in the debate in July last year, we reached an agreement with the Community and wrote into the record what we and the Commonwealth countries concerned accept as the practical meaning of that agreement. We shall be a member of the Community when the post-1974 arrangements are fulfilled and we are confident that the Community's undertaking will be implemented in the manner set out in the Lancaster House Declaration.

[Sir ROBERT GRANT-FERRIS in the Chair]

7.0 p.m.

Mr. Shore: We have heard a remarkable speech from the Minister of Agriculture following a remarkable debate. We were happy to have his frank correction of what he said earlier and his confirmation that he made a slip when answering a Question on an earlier occasion in the House to the effect that the Community had accepted the Government statement about the sugar agreement. He corrected this to say that they had instead noted the statement.
I emphasise the important distinction between "accepting" and "noting". As my hon. Friend the Member for Walthamstow, West (Mr. Deakins) has said, if we could have been assured that the Minister of Agriculture's use of the word "accepted" expressed the meaning, the policy and the facts of the situation, we could have wound up the debate straight away and we would all have been happy. That is not the situation.
Whilst commenting on a number of points which the Minister of Agriculture has made, I must begin by reiterating what is the essential reason for our having moved this Amendment this afternoon. My right hon. Friend and others have spoken to it because we are not satisfied. I put aside for the moment other matters such as domestic prices of sugar. I put aside the problems of our own beet-sugar growers. They are not the heart issues of this debate.
I take up the central factor that we were not satisfied with the assurances given to the Commonwealth countries that they would be able to supply the United Kingdom with the same quantities of sugar as they now export when the Commonwealth Sugar Agreement expires in 1975, two years after the Government propose that we should join the Common Market. We accept that the Government have given the developing Commonwealth countries a firm and definite assurance about the future of their sugar sales. These guarantees are contained in the Lancaster House communiqué issued last June. I have no complaint about the communiqué. It states as categorically as anyone could reasonably ask the Government's inter-

pretation of the agreement entered into and their resolve to honour it.
The reason we are concerned, as has already been made clear, is that this agreement, the Lancaster House agreement is not to be found in the Treaty of Accession and, therefore, is not be found in the Bill. It is precisely to make sure that there is no misunderstanding whatsoever that we have tabled this Amendment.
What concerns us is that in the absence of the Lancaster House agreement in the text of the Treaty of Accession, there is no real validity, no legality, no enforce-ability of the agreements which were entered into. If in 1974 Britain's commercial policies, including our food import policies, were still in our hands, we might take a more relaxed view about the prospect. However, as the Minister confirmed to us only a short time ago, this will not be the case as far as any further negotiations with Commonwealth sugar-producing countries are concerned. It will not be Britain with whom they are negotiating, because Britain will no longer exist as a separate commercial entity. They will have to negotiate with the enlarged Community, to whom we shall have handed over the right and the power which we now possess to make commercial agreements. That is the reality of the matter.
I have only one quotation to make from Protocol No. 17 which is worth putting to the Committee. It states at the very beginning:
Until 28th February, 1975, the United Kingdom is authorised to import from the exporting countries and territories referred to in the Commonwealth Sugar Agreement, on the following terms, quantities of sugar within the negotiated price quotas under that Agreement.
I quote that to make it absolutely plain that we are authorised until 25th February, 1975. Our concern, then, is what happens afterwards.
I want to take up straight away the Minister's explanation as to why the Lancaster House agreement was not in the treaties. I listened to him with great interest on this point because on 15th March I probed this matter. I was exploring then what we call the treaty complex covered by Clause 1. I drew attention to what I called the conspicuous absentees in the hundreds of agreements


and arrangements to which that Clause sought to give substance.
The two absentees which I identified were the reference to a national veto, which is a matter of some importance, and the Luxembourg statement to that effect at the beginning of 1966. The other great conspicuous absentee was the Lancaster House agreement on Commonwealth sugar. I contrasted this with the treatment meted out when the Government wish to make matters plain either by an exchange of letters on sterling or in protocols as they have done in the case of New Zealand and many other matters. What is so remarkable is not that there is not already a protocol on sugar. There is a protocol on sugar. People have been quoting quite considerable parts of Protocol No. 17 in Committee this afternoon. What is remarkable about the protocol is that it has nothing to say about the Commonwealth Sugar Agreement, other than what I have already quoted, which is that we are authorised until 25th February, 1975, to import under its arrangements. It does not say one word about what is to happen thereafter. That is remarkable, because in all the other protocols and agreements which have a transitional period derogation is allowed against the basic rule of the treaty. All those other matters do not simply state what is the situation during the derogation; they go on to say roughly what procedures are to be followed in determining the period thereafter.
But this has nothing to say about this at all.
The Minister of Agriculture tried to explain this omission by saying that the real reason is that the Lancaster House conference did not form part of the negotiations with the Six, that it was a bilateral negotiation between Britain and the Commonwealth countries. I am wholly unconvinced by what he says about that being the reason why it should not be part of the treaty. I am wholly unconvinced because I am quite sure that the Commonwealth countries themselves assume that when he reported the Lancaster House results to Brussels it would then have been the subject of further negotiations with a view to agreement with them, and that he would then come back and make it plain that it had been

accepted by them. The reason why it was never put to the Council for its explicit acceptance was that the Minister did not dare risk a rebuff, and so he had to be content with the uncertain, ambiguous word that they had "noted" it.
I have one further point to drive this home to the Government. It is not the first time that a main treaty signed by the Community has had a protocol in which one of its members has reached agreements with other countries which are not part of the central negotiation between the Six. Look at the Rome Treaty. It is full of protocols in which the original member States entered into arrangements with countries which were neither members of the Six nor brought into direct negotiations with the Six. The agreements which the main countries of the Six made with those other countries were not just noted; they were spelt out in separate protocols in the Treaty of Rome. Therefore it will not wash; right hon. and hon. Gentlemen opposite will have to think of a better and more convincing explanation.

Mr. Body: But it goes much further. There are declarations of intent. India has secured such a declaration in the treaty for her sugar exports.

Mr. Shore: The hon. Gentleman is correct. I gave way to him because I knew that he was anxious to get in earlier and had tried to intervene during the Minister's speech a few moments ago.
Part of the defence which has been put to us is that, somehow, the words in Protocol No. 22 are of an equivalent status to what has been spelled out in terms in the Lancaster House communiqué. Those words in Protocol No. 22 say:
The Community will have as its firm purpose the safeguarding of the interests of all the countries referred to in this Protocol whose economies depend to a considerable extent on the export of primary products, and particularly of sugar. The question of sugar will be settled within this framework…",
the framework being the possibilities of negotiation with a view to association to the enlarged Community.
That is the other position. But, as has been pointed out from both sides of the Committee, to have a general statement of intent of this kind is not the same as a specific moral and binding


guarantee, to adopt the words used by the Chancellor of the Duchy.
Another reason why this promise of association is not good enough is that it is not open to a number of the territories involved to have associated status. Let us take India, for example. It is part of the Commonwealth Sugar Agreement. It sells sugar. It is explicitly denied the possibility of becoming an associate member. So far as association is a defence, it cannot apply to India.
In addition, why should anyone imagine that countries of the British Commonwealth which are sugar producers, like the West Indies and Africa, will in the end wish to become associated with the enlarged Community? A number of them will not because the Community demands reverse preferences and because the United States is very unhappy and threatening to withdraw privileges from countries which are in the reverse preference system of the European Community. This is a very powerful reason why many of them, in the West Indies especially, will in the end not feel themselves able to avail themselves of this offer.

Mr. Rippon: The right hon. Gentleman will appreciate that it was because the offer of association was not extended to India that India was dealt with in the Declaration of Intent. It was made clear that the purpose was to extend its trade. As for offers of association or a trade agreement, the reason why this is linked to sugar is so that if any country does not want any form of association it will be able to deal with this matter in the context of a trade agreement, although it does not follow that the Community must insist on reverse preferences.

Mr. Shore: Under Article 113 of the treaty trade agreements are to be dealt with by majority voting, and trade agreements do not have to be reported to this House under Clause 1(3).
Finally, in the case of India are we now to assume that the guarantee of India's sugar is embodied in that joint declaration of intent? If so, it will have to be the most extraordinary interpretation, which does not suggest itself to any normal reading of that protocol. There are two paragraphs. The right hon. and learned

Gentleman will not find it difficult to look it up.

Mr. Rippon: The Joint Declaration of Intent on page 117 says:
The question of exports of sugar from India to the Community after the expiry of the Commonwealth Sugar Agreement on 31st December, 1974, must be settled by the Community in the light of this Declaration of Intent, taking account of the provisions which may be adopted…in Protocol No. 22…".

7.15 p.m.

Mr. Shore: That is perfectly right. I do not mean that the subject matter is not covered. I mean that the specific guarantees of quantities of sugar on which Commonwealth sugar producers have to make their plans are not covered.
I turn to my last reason for concern. Again, it has been touched upon by a number of hon. Members on both sides of the Committee. It is the central reason. It is the fact that the European Community already is self-sufficient in sugar and has policies to continue to be self-sufficient. That is a matter which cannot be brushed aside. We know that beet sugar is grown extensively and that it is protected by the levy system of the Community. It is true that the consumption of sugar has increased in the Community in recent years. However, production has increased even more. The plain truth is that 1967 was the last year in which the Community ceased to be an importer of sugar. In 1968, 1969 and 1970 sugar exports by the Community were substantial and growing, just as production had been growing. No less than £100 million a year is spent out of the CAP supporting Community sugar, of which no less than £50 million is to subsidise Community sugar selling below its own price and being dumped on world markets. There are powerful interests which have to be faced here.
My conclusion is that all the mainland farming interests of Europe are bound to be united against us in our efforts to maintain after February, 1975, an un-diminished outlet for Commonwealth sugar. Whether we are to be authorised beyond February, 1975, to continue to import the same quantity or even a diminished quantity of Commonwealth sugar, there is bound to be a great challenge. Therefore, we come to this specific Amendment.
I do not charge Ministers with bad faith in their attempts to secure the interests of the Commonwealth sugar producing countries. Nor do I say that all the countries of Europe have set their faces against any kind of arrangement which would be helpful. I am sure that there is more intelligence and understanding in the Commission than many people would begin to believe. However, there will be a very formidable opposition to break to make sure that the Commonwealth continues to sell sugar to Europe.
To succeed is to make the first break in the common agricultural policy of the Six. It is a major challenge to that system. It is especially a challenge to the interests of France and one or two of the other countries concerned. It is a challenge which is made not directly by us but by many small countries which are weak and isolated. I believe that it is our duty to defend their interests. I do not say that a British Government would not attempt to do so on the basis of the rather thin verbal guarantees that we have. All that I say is that I know that this House will defend those interests if this amended Clause is written into the Bill.

Mr. J. H. Osborn: May one of the silent majority during this approach to enter the Common Market make some observations? I have listened to all the debate and I was disappointed when the right hon. Member for Stepney (Mr. Shore) did not give way for an intervention I wanted to make.
I said on Second Reading that entry to the Common Market was a challenge. The negotiations themselves are a challenge, and a challenge to the Government. By saying that I do not wish to imply that the Government are not meeting that challenge. The very complexity of the issues which we have discussed tonight has convinced me of the difficulties which lie before us and which we must overcome. My right hon. Friend the Minister of Agriculture has given us a very sober and realistic appraisal of what he has achieved so far, an appraisal which I am certain will give some satisfaction in the Commonwealth, especially among sugar producers who are concerned about their future markets and exports in the years to come.
Many hon. Members have referred to the metropolitan areas of Martinique and

Guadéloupe. In the last 12 months, I have been there and have seen the extent of the sugar production—

Mr. Arthur Lewis: How did the hon. Member arrange that?

Mr. Osborn: I hope that the hon. Member will allow me to make my own speech. I have been in the Chamber throughout this debate.
Let us have no illusion. On totting up the speeches made today, with the exception of that of my hon. Friend the Member for Dorking (Sir G. Sinclair), it would be easy to imagine that the House of Commons was against the Government on the sugar issue. As one of the silent majority I should like to assure my right hon. Friends that I am one of many who support the Government in their approach and wish them well in their very difficult negotiations.
The British housewife might gain the impression from my right hon. Friend the Member for Thirsk and Malton (Sir Robin Turton) that the price of sugar will be doubled. He was corrected on this. The housewife is concerned about the price of sugar, but overall it is the impact of entry which is of so much greater importance.
The most important issue is that those who are concerned about the interests of the sugar producers want the Government to remain alert. We had the Lancaster House communiqué, but there is concern that there should be adequate continuation of the negotiations to ensure that the markets which the Commonwealth sugar producers now have are assured after 1975. My right hon. Friend has given us assurances on this. If hon. Members feel that he is defaulting in the complexities which lie ahead, he can rest assured that some of us will try to keep him on his toes.
The hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) talked of Mauritius and Swaziland. I have been to Swaziland three times during the last five years and once with him and have seen the extent of the sugar production and the extent of British money in the sugar mills there. Those of us who have been out have suggested alternative crops and to an increasing extent citrus and rice have replaced the sugar. I accept


that Mauritius is another problem altogether. I have been there. As my right hon. Friend said, sugar accounts for 95 per cent. of the country's total exports.
The right hon. Member for Stepney talked about production in Europe. According to the International Sugar Organisation figures, total production in the EEC was 7·2 million metric tons raw value in 1967, 7·3 million in 1968, 8·1 million in 1969 and 8·7 million in 1971. It has been steadily rising. In the wider Community, production has risen between 1967 and 1971 from 8·6 million tons to 10·3 million. In the same period total consumption in the wider Community has risen from 10·1 million tons to 10·6 million tons.
The important thing is that, whereas in 1968 the gap between production and consumption was 2·00 million tons, production being 10·7 million and consumption 8·7 million—that is the excess production over consumption—that gap has now been reduced. In 1971 it was only 344,000 tons. My right hon. Friend pointed out that if these trends go on as they are, there will be an increasing demand for sugar from outside the Community. The assurance which the Minister has given us, that there will be a demand for 1·4 million tons of cane sugar from outside, is surely a statistical reality that can give some comfort and assurance to Commonwealth sugar producers.
I ask my right hon. Friend to bear in mind that those in the Commonwealth with sugar interests want to be kept informed. Throughout discussion there is the challenge of adequate communications. We in the House would wish to know at regular intervals the extent to which, in the Community as a whole, sugar is being produced within the Community from beet as against imported

from outside from cane. Information has been lacking. Had I spoken earlier I would have asked for greater clarification of the confused figures obtained from different sources, circulated to those with an interest in sugar as well as to hon. Members.

I would also ask my right hon. Friend to find a mechanism to notify the Commonwealth sugar producers of the progress which was made in discussions with the Community and to continue to give them that assurance we gave them in the Lancaster House communiqué. It is vital that they should have that assurance. Having visited many sugar producing countries, including Mauritius and many in the Caribbean where cane sugar producers depend on adequate export markets, I would ask my right hon. Friend to ensure that they are given the information they require to have to maintain confidence in the next two or three years.

These Amendments are irrelevant and unnecessary in the content of the agreement and the negotiations that have taken place. There has been negotiation and an agreement has been reached in good faith. I am certain that our Community partners reflect the good faith expressed to my right hon. Friends. Therefore, I will not be supporting the Amendments tonight.

Mr. Molloy: There can be little doubt that the arguments adduced in support of these Amendments on both sides were so formidable that there was no essential answer from the Minister. He did his best and gave way a number of times, but we have not had a proper opportunity to debate these matters.

Question put, That the Amendment be made: —

The Committee divided:  Ayes 264, Noes 272.

Division No. 246.]
AYES
[7.30 p.m.


Abse, Leo
Baxter, William
Boyden, James (Bishop Auckland)


Allaun, Frank (Salford, E.)
Benn, Rt. Hn. Anthony Wedgwood
Bradley, Tom


Allen, Scholefield
Bennett, James (Glasgow, Bridgeton)
Brown, Bob (N'c'tle-upon-Tyne,W.)


Archer, Peter (Rowley Regis)
Bidwell, Sydney
Brown, Hugh D. (G'gow, Provan)


Armstrong, Ernest
Biffen, John
Brown, Ronald (Shoreditch &amp; F'bury)


Ashley, Jack
Bishop, E. S.
Buchan, Norman


Ashton, Joe
Blenkinsop, Arthur
Buchanan, Richard (G'gow, Sp'burn)


Atkinson, Norman
Boardman, H. (Leigh)
Butler, Mrs. Joyce (Wood Green)


Bagier, Gordon A. T.
Body, Richard
Campbell, I. (Dunbartonshire, W.)


Barnett, Guy (Greenwich)
Booth, Albert
Cant, R. B.


Barnett, Joel (Heywood and Royton)
Bottomley, Rt. Hn. Arthur
Carmichael, Neil




Carter, Ray (Birmingh'm, Northfield)
Jenkins, Hugh (Putney)
Parker, John (Dagenham)


Carter-Jones, Lewis (Eccles)
Jenkins, Rt. Hn. Roy (Stechford)
Parry, Robert (Liverpool, Exchange)


Castle, Rt. Hn. Barbara
John, Brynmor
Peart, Rt. Hn. Fred


Clark, David (Colne Valley)
Johnson, James (K'ston-on-Hull, W.
Pendry, Tom


Cocks, Michael (Bristol, S.)
Johnson, Walter (Derby, S.)
Pentland, Norman


Cohen, Stanley
Jones, Barry (Flint, E.)
Perry, Ernest G.


Concannon, J. D.
Jones, Dan (Burnley)
Powell, Rt. Hn. J. Enoch


Cox, Thomas (Wandsworth, C.)
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Prentice, Rt. Hn. Reg.


Crawshaw, Richard
Jones, Gwynoro (Carmarthen)
Prescott, John


Cronin, John
Jones, T. Alec (Rhondda, W.)
Price, J. T. (Westhoughton)


Crosland, Rt. Hn. Anthony
Kaufman, Gerald
Price, William (Rugby)


Crossman, Rt. Hn. Richard
Kelley, Richard
Probert, Arthur


Cunningham, G. (Islington, S.W.)
Kerr, Russell
Rankin, John


Davies, Denzil (Llanelly)
Kilfedder, James
Reed, D. (Sedgefield)


Davies, Ifor (Gower)
Kinnock, Neil
Rees, Merlyn (Leeds, S.)


Davis, Clinton (Hackney, C.)
Lambie, David
Rhodes, Geoffrey


Davis, Terry (Bromsgrove)
Lamborn, Harry
Richard, Ivor


Deakins, Eric
Lamond, James
Roberts, Albert (Normanton)


de Freitas, Rt. Hn. Sir Geoffrey
Latham, Arthur
Roberts, Rt.Hn.Goronwy (Caernarvon)


Dell, Rt. Hn. Edmund
Leadbitter, Ted
Robertson, John (Paisley)


Dempsey, James
Lee, Rt. Hn. Frederick
Roderick, Caerwyn E.(Brc'n&amp;R'dnor)


Doig, Peter
Leonard, Dick
Rodgers, William (Stockton-on-Tees)


Dormand, J. D.
Lever, Rt. Hn. Harold
Roper, John


Douglas, Dick (Stirlingshire, E.)
Lewis, Arthur (W. Ham, N.)
Rose, Paul B.


Douglas-Mann, Bruce
Lewis, Ron (Carlisle)
Ross, Rt. Hn. William (Kilmarnock)


Duffy, A. E. P.
Lomas, Kenneth
Rowlands, Ted


Dunnett, Jack
Loughlin, Charles
Russell, Sir Ronald


Eadie, Alex
Lyon, Alexander W. (York)
Sandelson, Neville


Edelman, Maurice
Lyons, Edward (Bradford, E.)
Sheldon, Robert (Ashton-under-Lyne)


Edwards, Robert (Bilston)
Mabon, Dr. J. Dickson
Shore, Rt. Hn. Peter (Stepney)


Edwards, William (Merioneth)
McBride, Neil
Short, Rt. Hn. Edward (N'c'tle-u-Tyne)


Ellis, Tom
McCartney, Hugh
Silkin, Rt. Hn. John (Deptford)


English, Michael
McGuire, Michael
Silkin, Hn. S. C. (Dulwich)


Evans, Fred
Mackenzie, Gregor
Sillars, James


Ewing, Henry
Mackie, John
Silverman, Julius


Faulds, Andrew
Mackintosh, John P.
Skinner, Dennis


Fell, Anthony
Maclennan, Robert
Small, William


Fisher, Mrs. Doris(B'ham,Ladywood)

Smith, John (Lanarkshire, N.)


Fitch, Alan (Wigan)
McMaster, Stanley
Spearing, Nigel


Fletcher, Raymond (Ilkeston)
McMillan, Tom (Glasgow, C.)
Spriggs, Leslie


Fletcher, Ted (Darlington)
McNamara, J. Kevin
Stallard, A. W.


Foley, Maurice
Maginnis, John E.
Stoddart, David (Swindon)


Foot, Michael
Mahon, Simon (Bootle)
Stonehouse, Rt. Hn. John


Ford, Ben
Mallalieu, J. P. W. (Huddersfield, E.)
Strang, Gavin


Forrester, John
Marks, Kenneth
Strauss, Rt. Hn. G. R.


Fraser, John (Norwood)
Marsden, F.
Summerskill, Hn. Dr. Shirley


Freeson, Reginald
Marshall, Dr. Edmund
Swain, Thomas


Garrett, W. E.
Marten, Neil
Thomas, Jeffrey (Abertillery)


Gilbert, Dr. John
Mason, Rt. Hn. Roy
Thomson, Rt. Hn. G. (Dundee, E.)


Ginsburg, David (Dewsbury)
Mayhew, Christopher
Tinn, James


Gourlay, Harry
Meacher, Michael
Tomney, Frank


Grant, George (Morpeth)
Mellish, Rt. Hn. Robert
Torney, Tom


Grant, John D. (Islington, E.)
Mendelson, John
Turton, Rt. Hn. Sir Robin


Griffiths, Eddie (Brightside)
Mikardo, Ian
Urwin, T. W.


Griffiths, Will (Exchange)
Millan, Bruce
Varley, Eric G.


Hamilton, James (Bothwell)
Miller, Dr. M. S.
Wainwright. Edwin


Hamilton, William (Fife, W.)
Milne, Edward
Walden, Brian (B'm'ham, All Saints)


Hamling, William
Mitchell, R. C. (S'hampton, Itchen)
Walker, Harold (Doncaster)


Hardy, Peter
Moate, Roger
Walker-Smith, Rt. Hn. Sir Derek


Harper, Joseph
Molloy, William
Wallace, George


Harrison, Walter (Wakefield)
Molyneaux, James
Watkins, David


Healey, Rt. Hn. Denis
Morgan, Elystan (Cardiganshire)
Weitzman, David


Heffer, Eric S.
Morris, Alfred (Wythenshawe)
Wellbeloved, James


Hilton, W. S.
Morris, Charles R. (Openshaw)
Wells, William (Walsall, N.)


Hooson, Emlyn
Morris, Rt. Hn. John (Aberavon)
White. James (Glasgow, Pollok)


Horam, John
Moyle, Roland
Whitehead, Philip


Houghton, Rt. Hn. Douglas
Mulley, Rt. Hn. Frederick
Whitlock, William


Howell, Denis (Small Heath)
Murray, Ronald King
Willey, Rt. Hn. Frederick


Huckfield, Leslie
Oakes, Gordon
Williams, Alan (Swansea, W.)


Hughes, Rt. Hn. Cledwyn (Anglesey)
Ogden, Eric
Williams, Mrs. Shirley (Hitchin)


Hughes, Mark (Durham)
O'Halloran, Michael
Williams, W. T. (Warrington)


Hughes, Robert (Aberdeen, N.)
O'Malley, Brian
Wilson, Alexander (Hamilton)


Hughes, Roy (Newport)
Oram, Bert
Wilson, William (Coventry, S.)


Hunter, Adam
Orme, Stanley
Woof, Robert


Hutchison, Michael Clark
Oswald, Thomas



Irvine,Rt.Hn.SirArthur(Edge Hill)
Owen, Dr. David (Plymouth, Sutton)
TELLERS FOR THE AYES:


Janner, Greville
Paget, R. T.
Mr. James A. Dunn and


Jay, Rt. Hn. Douglas
Palmer, Arthur
Mr. John Golding.


Jeger, Mrs. Lena
Pannell, Rt. Hn. Charles





NOES


Adley, Robert
Archer, Jeffrey (Louth)
Awdry, Daniel


Alison, Micheal (Barkston Ash)
Astor, John
Baker, Kenneth (St. Marylebone


Allason, James (Hemel Hempstead)
Atkins, Humphrey
Balniel, Rt. Hn. Lord







Batsford, Brian
Grimond, Rt. Hn. J.
Murton, Oscar


Beamish, Col. Sir Tufton
Grylls, Michael
Neave, Airey


Bennett, Sir Frederic (Torquay)
Gummer, J. Selwyn
Nicholls, Sir Harmar


Bennett, Dr. Reginald (Gosport)
Gurden, Harold
Noble, Rt. Hn. Michael


Benyon, W.
Hall, Miss Joan (Keighley)
Normanton, Tom


Berry, Hn. Anthony
Hall, John (Wycombe)
Nott, John


Biggs-Davison, John
Hall-Davis, A. G. F.
Onslow, Cranley


Blaker, Peter
Hamilton, Michael (Salisbury)
Oppenheim, Mrs. Sally


Boardman, Tom (Leicester, S.W.)
Hannam, John (Exeter)
Osborn, John


Boscawen, Robert
Harrison, Brian (Maldon)
Owen, Idris (Stockport, N.)


Bossom, Sir Clive
Harrison, Col. Sir Harwood (Eye)



Bowden, Andrew
Haselhurst, Alan
Page, Rt. Hn. Graham (Crosby)


Braine, Sir Bernard
Hastings, Stephen
Page, John (Harrow, W.)


Bray, Ronald
Havers, Michael
Parkinson, Cecil


Brinton, Sir Tatton
Hawkins, Paul
Percival, Ian


Brocklebank-Fowler, Christopher
Hayhoe, Barney
Peyton, Rt. Hn. John


Brown, Sir Edward (Bath)
Heath, Fit. Hn. Edward
Pike, Miss Mervyn


Bruce-Gardyne, J.
Heseltine, Michael
Pink, R. Bonner


Bryan, Sir Paul
Hicks, Robert
Pounder, Rafton


Buchanan-Smith, Alick(Angus,N&amp;M)
Higgins, Terence L.
Price, David (Eastleigh)



Hiley, Joseph
Prior, Rt. Hn. J. M. L.


Buck, Antony
Hill, John E. B. (Norfolk, S.)
Proudfoot, Wilfred


Burden, F. A.
Hill, James (Southampton, Test)
Pym, Rt. Hn. Francis


Butler, Adam (Bosworth)
Holland, Philip
Quennell, Miss J. M.


Campbell. Rt.Hn.G.(Moray &amp; Nairn)
Holt, Miss Mary
Raison, Timothy


Carlisle, Mark
Hordern, Peter
Ramsden, Rt. Hn. James


Carr, Rt. Hn. Robert
Hornby, Richard
Rawlinson, Rt. Hn. Sir Peter


Cary, Sir Robert
Hornsby-Smith,Rt.Hn.Dame Patricia
Redmond, Robert


Channon, Paul
Howe, Hn. Sir Geoffrey (Reigate)
Reed, Laurance (Bolton, E.)


Chapman, Sydney
Howell, Ralph (Norfolk, N.)
Rees, Peter (Dover)


Chataway, Rt. Hn. Christopher
Hunt, John
Rees-Davies, W. R.


Chichester-Clark, R.
Iremonger, T. L.
Renton, Rt. Hn. Sir David


Clark, William (Surrey, E.)
James, David
Rhys Williams, Sir Brandon


Clegg, Walter
Jenkin, Patrick (Woodford)
Ridley, Hn. Nicholas


Cockeram, Eric
Johnson Smith, G. (E. Grinstead)
Ridsdale, Julian


Cooke, Robert
Jones, Arthur (Northants, S.)
Rippon, Rt. Hn. Geoffrey


Cooper, A. E.
Jopling, Michael
Roberts, Michael (Cardiff, N.)


Cordle, John
Joseph, Rt. Hn. Sir Keith
Roberts, Wyn (Conway)


Corfield, Rt. Hn. Sir Frederick
Kellett-Bowman, Mrs. Elaine
Rost, Peter


Cormack, Patrick
Kershaw, Anthony
Royle, Anthony


Costain, A. P.
King, Evelyn (Dorset, S.)
Sandys, Rt. Hn. D.


Critchley, Julian
King, Tom (Bridgwater)
Scott, Nicholas


Crouch, David
Kinsey, J. R.
Sharples, Richard


Crowder, F. P.
Kirk, Peter
Shaw, Michael (Sc'b'gh &amp; Whitby)


Dalkeith, Earl of
Kitson, Timothy
Shelton, William (Clapham)


Davies, Rt. Hn. John (Knutslord)
Knight, Mrs. Jill
Simeons, Charles


d'Avigdor-Goldsmid, Sir Henry
Knox, David
Sinclair, Sir George


d'Avigdor-Goldsmid.Maj.-Gen.James
Lambton Lord
Skeet, T. H. H.


Dean, Paul
Lamont, Norman
Smith, Dudley (W'wick &amp; L'mington)


Deedes, Rt. Hn. W. F.
Lane, David
Soref, Harold


Dixon, Piers
Legge-Bourke, Sir Harry
Speed, Keith


Drayson, G. B.
Le Marchant, Spencer
Spence, John


du Cann, Rt. Hn. Edward
Lewis, Kenneth (Rutland)
Sproat, Iain


Dykes, Hugh
Lloyd, Ian (P'tsm'th, Langstone)
Stainton, Keith


Eden, Sir John
Longden, Sir Gilbert
Stanbrook, Ivor


Edwards, Nicholas (Pembroke)
Loveridge, John
Steel, David


Elliot, Capt. Walter (Carshalton)
Luce, R. N.
Stewart-Smith, Geoffrey (Belper)


Elliott, R. W. (N'ctle-upon-Tyne,N.)
McAdden, Sir Stephen
Stodart, Anthony (Edinburgh, W.)


Emery, Peter
MacArthur, Ian
Stoddart-Scott, Col. Sir M.


Eyre, Reginald
McCrindle, R. A.
Stokes, John


Fenner, Mrs. Peggy
McLaren, Martin
Stuttaford, Dr. Tom


Fidler, Michael
Maclean, Sir Fitzroy
Tapsell, Peter


Finsberg, Geoffrey (Hampslead)
Macmillan.Rt.Hn.Maurice (Farnham)
Taylor, Sir Charles (Eastbourne)


Fisher, Nigel (Surbiton)
McNair-Wilson, Michael
Taylor, Frank (Moss Side)


Fletcher-Cooke, Charles
McNair-Wilson, Patrick (NewForest)
Taylor, Robert (Croydon, N.W.)


Fookes, Miss Janet
Maddan, Martin
Tebbit, Norman


Fortescue, Tim
Madel, David
Temple, John M.


Foster, Sir John
Marples, Rt. Hn. Ernest
Thatcher, Rt. Hn. Mrs. Margaret


Fowler, Norman
Mather, Carol
Thomas, John Stradling (Monmouth)


Fry, Peter
Maudling, Rt. Hn. Reginald
Thomas, Rt. Hn. Peter (Hendon.S.)


Galbraith, Hn. T. G.
Mawby, Ray
Thompson, Sir Richard (Croydon, S.)


Gardner, Edward
Maxwell-Hyslop, R. J.
Tilney, John


Gibson-Watt, David
Meyer, Sir Anthony
Tratford, Dr. Anthony


Gilmour, Ian (Norfolk, C.)
Mills, Peter (Torrington)
Trew, Peter


Gilmour, Sir John (Fife, E.)
Mills, Stratton (Belfast, N.)
Tugendhat, Christopher


Glyn, Dr. Alan
Miscampbell, Norman
Vaughan, Dr. Gerard


Godber, Rt. Hn. J. B.
Mitchell,Lt.-Col.C.(Aberdeenshire,W)
Vickers, Dame Joan


Goodhart, Philip
Mitchell, David (Basingstoke)
Waddington, David


Goodhew, Victor
Money, Ernle
Walker, Rt. Hn. Peter (Worcester)


Gorst, John
Monks, Mrs. Connie
Ward, Dame Irene


Gower, Raymond
Monro, Hector
Warren, Kenneth


Grant, Anthony (Harrow, C.)
Montgomery, Fergus
Weatherill, Bernard


Gray, Hamish
More, Jasper
Wells, John (Maidstone)


Green, Alan
Morrison, Charles
White, Roger (Gravesend)


Griffiths, Eldon (Bury St. Edmunds)
Mudd, David
Wiggln, Jerry







Wilkinson, John
Woodnutt, Mark



Winterton, Nicholas
Worsley, Marcus
TELLERS FOR THE NOES:


Wolrige-Gordon, Patrick
Wylie, Rt. Hn. N. R.
Mr. Marcus Fox and


Wood, Rt. Hn. Richard
Younger, Hn. George
Mr. Kenneth Clarke


Woodhouse, Hn. Christopher

Amendment accordingly negatived.

It being after half-past Seven o'clock, THE CHAIRMAN proceeded, pursuant to Order [2nd May] to put forthwith the Question necessary for the disposal of the business to be concluded at that hour.

Question put, That the Clause stand part of the Bill: —

The Committee divided:  Ayes 273, Noes 264.

Division No. 247.]
AYES
[7.40 p.m.


Adley, Robert
Emery, Peter
Kershaw, Anthony


Alison, Michael (Barkston Ash)
Eyre, Reginald
King, Evelyn (Dorset, S.)


Allason, James (Hemel Hempstead)
Fenner, Mrs. Peggy
King, Tom (Bridgwater)


Archer, Jeffrey (Louth)
Fidler, Michael
Kinsey, J. R.


Astor, John
Finsberg, Geoffrey (Hampstead)
Kirk, Peter


Atkins, Humphrey
Fisher, Nigel (Surbiton)
Kitson, Timothy


Awdry, Daniel
Fletcher-Cooke, Charles
Knight, Mrs. Jill


Baker, Kenneth (St. Marylebone)
Fookes, Miss Janet
Knox, David


Balniel, Lord
Fortescue, Tim
Lambton, Lord


Batsford, Brian
Foster, Sir John
Lamont, Norman


Beamish, Col. Sir Tufton
Fowler, Norman
Lane, David


Bennett, Sir Frederic (Torquay)
Fry, Peter



Bennett, Dr. Reginald (Gosport)
Galbraith, Hn. T. G.
Legge-Bourke, Sir Harry


Benyon, W.
Gardner, Edward
Le Marchant, Spencer


Berry, Hn. Anthony
Gibson-Watt, David
Lewis, Kenneth (Rutland)


Biggs-Davison, John
Gilmour, Ian (Norfolk, C.)
Lloyd, Ian (P'tsm'th, Langstone)


Blaker, Peter
Gilmour, Sir John (Fife, E.)
Longden, Sir Gilbert


Boardman, Tom (Leicester, S.W.)
Glyn, Dr. Alan
Loveridge, John


Boscawen, Robert
Godber, Rt. Hn. J. B.
Luce, R. N.


Bossom, Sir Clive
Goodhart, Philip
McAdden, Sir Stephen


Bowden, Andrew
Goodhew, Victor
MacArthur, Ian


Braine, Sir Bernard
Gorst, John
McCrindle, R. A.


Bray, Ronald
Gower, Raymond
McLaren, Martin


Brinton, Sir Tatton
Grant, Anthony (Harrow, C.)
Maclean, Sir Fitzroy


Brocklebank-Fowler, Christopher
Gray, Hamish
Macmillan.Rt.Hn.Maurice (Farnham)


Brown, Sir Edward (Bath)
Green, Alan
McNair-Wilson, Michael


Bruce-Gardyne, J.
Griffiths, Eldon (Bury St. Edmunds)
McNair-Wilson, Patrick (NewForest)



Grimond, Rt. Hn. J.
Maddan, Martin


Bryan, Sir Paul
Grylls, Michael
Madel, David


Buchanan-Smith, Alick(Angus,N&amp;M)
Gummer, J. Selwyn
Marples, Rt. Hn. Ernest


Buck, Antony
Gurden, Harold
Mather, Carol


Burden, F. A.
Hall, Miss Joan (Keighley)
Maudling, Rt. Hn. Reginald


Butler, Adam (Bosworth)
Halt, John (Wycombe)
Mawby, Ray


Campbell, Rt.Hn.G.(Moray&amp;Nairn)
Hall-Davis, A. G. F.
Maxwetl-Hyslop, R. J.


Carlisle, Mark
Hamilton. Michael (Salisbury)
Meyer, Sir Anthony


Carr, Rt. Hn. Robert
Hannam, John (Exeter)
Mills, Peter (Torrington)


Cary, Sir Robert
Harrison, Brian (Maldon)
Mills, Stratton (Belfast, N.)


Channon, Paul
Harrison, Col. Sir Harwood (Eye)
Miscampbell, Norman


Chapman, Sydney
Haselhurst, Alan
Mltehell,Lt.-Col.C.(Aberdeenshir,W)


Chataway, Rt. Hn. Christopher
Hastings, Stephen
Mitchell, David (Basingstoke)


Chichester-Clark, R.
Havers, Michael
Money, Ernle


Clark, William (Surrey, E.)
Hawkins, Paul
Monks, Mrs. Connie


Clegg, Walter
Hayhoe, Barney
Monro, Hector


Cockeram, Eric
Heath, Rt. Hn. Edward
Montgomery, Fergus


Cooke, Robert
Heseltine, Michael
More, Jasper


Cooper, A. E.
Hicks, Robert
Morgan, Geraint (Denbigh)


Cordle, John
Higgins, Terence L.
Morrison, Charles


Corfield, Rt. Hn. Sir Frederick
Hiley, Joseph
Mudd, David


Cormack, Patrick
Hill, John E. B. (Norfolk, S.)
Murton, Oscar


Costain, A. P.
Hill, James (Southampton, Test)
Neave, Airey


Critchley, Julian
Holland, Philip
Nicholls, Sir Harmar


Crouch, David
Holt, Miss Mary
Noble, Rt. Hn. Michael


Crowder, F. P.
Hordern, Peter
Normanton, Tom


Dalkeith, Earl of
Hornby, Richard
Nott, John


Davies, Rt. Hn. John (Knutsford)
Hornsby-Smith,Rt.Hn.Dame Patricia
Onslow, Cranley


d'Avlgdor-Goldsmid, Sir Henry
Howe, Hn. Sir Geoffrey (Reigale)
Oppenheim, Mrs. Sally


d'Avigdor-Goldsmid,Maj.-Gen.James
Howell, Ralph (Norfolk, N.)
Osborn, John


Dean, Paul
Hunt, John
Owen, Idris (Stockport, N.)


Deedes, Rt. Hn. W. F.
Iremonger, T. L.
Page, Rt. Hn. Graham (Crosby)


Dixon, Piers
James, David
Page, John (Harrow. W.)


du Cann, Rt. Hn. Edward
Jenkin, Patrick (Woodford)
Parkinson, Cecil


Dykes, Hugh
Johnson Smith, G. (E. Grinstead)
Percival, Ian


Eden, Sir John
Jones, Arthur (Northants, S.)
Peyton, Rt. Hn. John


Edwards, Nicholas (Pembroke)
Jopiing, Michael
Pike, Miss Mervyn


Elliot, Capt. Walter (Carshalton)
Joseph, Rt. Hn. Sir Keith
Pink, R. Bonner


Elliott, R. W. (N'c'tle-upon-Tyne,N.)
Kellett-Bowman, Mrs. Elaine
Pounder, Rafton




Price, David (Eastleigh)
Sinclair, Sir George
Trew, Peter


Prior, Rt. Hn. J. M. L.
Skeet, T. H. H.
Tugendhat, Christopher


Proudfoot, Wilfred
Smith, Dudley (W'wick &amp; L'mington)
van Straubenzee, W. R


Pym, Rt. Hn. Francis
Soref, Harold
Vaughan, Dr. Gerard


Quennell, Miss J. M.
Speed, Keith
Vickers, Dame Joan


Raison, Timothy
Spence, John
Waddington, David


Ramsden, Rt. Hn. James
Sproat, Iain
Walker, Rt. Hn. Peter (Worcester)


Rawlinson, Rt. Hn. Sir Peter
Stainton, Keith
Ward, Dame Irene


Redmond, Robert
Stanbrook, Ivor
Warren, Kenneth


Reed, Laurance (Bollon, E.)
Steel, David
Weatherill, Bernard


Rees, Peter (Dover)
Stewart-Smith, Geoffrey (Belper)
Wells, John (Maidstone)


Rees-Davies, W. R.
Stodart, Anthony (Edinburgh, W.)
White, Roger (Gravesend)


Renton, Rt. Hn. Sir David
Stoddart-Scott, Col. Sir M
Wiggin, Jerry


Rhys Williams, Sir Brandon
Stokes, John
Wilkinson, John


Ridley, Hn. Nicholas
Stuttaford, Dr. Tom
Winterton, Nicholas


Ridsdale, Julian
Tapsell, Peter
Wolrige-Gordon, Patrick


Rippon, Rt. Hn. Geoffrey
Taylor, Sir Charles (Eastbourne)
Wood, Rt. Hn. Richard


Roberts, Michael (Cardiff, N.)
Taylor, Frank (Moss Side)
Woodhouse, Hn. Christopher


Roberts, Wyn (Conway)
Taylor, Robert (Croydon, N.W.)
Woodnutt, Mark


Rost, Peter
Tebbit, Norman
Worsley, Marcus


Royle, Anthony
Temple, John M.
Wylie, Rt. Hn. N. R.


Sandys, Rt. Hn. D
Thatcher, Rt. Hn. Mrs. Margaret
Younger, Hn. George


Scott, Nicholas
Thomas, John Stradling (Monmouth)



Sharples, Richard
Thomas, Rt. Hn. Peter (Hendon, S.)
TELLERS FOR THE AYES:


Shaw, Michael (Sc'b'gh &amp; Whitby)
Thompson, Sir Richard (Croydon. S.)
Mr Marcus Fox and


Shelton, William (Clapham)
Tilney, John
Mr. Kenneth Clarke.


Simeons, Charles
Trafford, Dr. Anthony





NOES


Abse, Leo
Dell, Rt. Hn. Edmund
Hughes, Roy (Newport)


Allaun, Frank (Salford, E.)
Dempsey, James
Hunter, Adam


Allen, Scholefield
Doig, Peter
Hutchison, Michael Clark


Archer, Peter (Rowley Regis)
Dormand, J. D.
Irvine,Rt.Hn.SirArthur(Edge Kill)


Armstrong, Ernest
Douglas, Dick (Stirlingshire, E.)
Janner, Greville


Ashley, Jack
Douglas-Mann, Bruce
Jay, Rt. Hn. Douglas


Ashton, Joe
Duffy, A. E. P.
Jeger, Mrs. Lena


Atkinson, Norman
Dunnett, Jack
Jenkins, Hugh (Putney)


Bagier, Gordon, A. T.
Eadie, Alex



Barnett, Guy (Greenwich)
Edelman, Maurice
Jenkins, Rt. Hn. Roy (Stechford)


Barnett, Joel (Heywood and Royton)
Edwards, Robert (Bilston)
John, Brynmor


Baxter, William
Edwards, William (Merioneth)
Johnson, James (K'ston-on-Hull, W.)



Ellis, Tom
Johnson, Walter (Derby, S.)


Benn, Rt. Hn. Anthony Wedgwood
English, Michael
Jones, Barry (Flint, E.)


Bennett, James (G'gow, Bridgeton)
Evans, Fred
Jones, Dan (Burnley)


Bidwell, Sydney
Ewing, Harry
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)


Biffen, John
Faulds, Andrew
Jones, Gwynoro (Carmarthen)


Bishop, E. S.
Fell, Anthony
Jones, T. Alec (Rhondda, W.)


Blenkinsop, Arthur
Fisher,Mrs.Doris (B'ham,Ladywood)
Kaufman, Gerald


Boardman, H. (Leigh)
Fitch, Alan (Wigan)
Kelley, Richard


Body, Richard
Fletcher, Raymond (Ilkeston)
Kerr, Russell


Booth, Albert
Fletcher, Ted (Darlington)
Killedder, James


Bottomley, Rt. Hn. Arthur
Foley, Maurice
Kinnock, Neil


Boyden, James (Bishop Auckland)
Foot, Michael
Lambie, David


Bradley, Tom
Ford, Ben
Lamborn, Harry


Brown, Bob (N'c'tle-upon-Tyne,W.)
Forrester, John
Lamond, James


Brown, Hugh D. (G'gow, Provan)
Fraser, John (Norwood)
Latham, Arthur


Brown, Ronald (Shoreditch &amp; F'bury)
Freeson, Reginald
Leadbitter, Ted


Buchan, Norman
Garrett, W. E.
Lee, Rt. Hn. Frederick


Buchanan, Richard (G'gow, Sp'burn)
Gilbert, Dr. John
Leonard, Dick


Butler, Mrs. Joyce (Wood Green)
Ginsburg, David (Dewsbury)
Lever, Rt. Hn. Harold


Campbell, I. (Dunbartonshire, W.)
Gourlay, Harry
Lewis, Arthur (W. Ham, N.)


Cant, R. B.
Grant, George (Morpeth)



Carmichael, Neil
Grant, John D. (Islington, E.)
Lewis, Ron (Carlisle)


Carter, Ray (Birmingh'm, Northfield)
Griffiths, Eddie (Brightside)
Lomas, Kenneth


Carter-Jones, Lewis (Eccles)
Griffiths, Will (Exchange)
Loughlin, Charles


Castle, Rt. Hn. Barbara
Hamilton, James (Bothwell)
Lyon, Alexander W. (York)


Clark, David (Colne Valley)
Hamilton, William (Fife, W.)
Lyons, Edward (Bradford, E.)


Cocks, Michael (Bristol, S.)
Hamling, William
Mabon, Dr. J. Dickson


Cohen, Stanley
Hardy, Peter
McBride, Neil


Concannon, J. D.
Harper, Joseph
McCartney, Hugh


Cox, Thomas (Wandsworth, C.)
Harrison, Walter (Wakefield)
McGuire, Michael


Crawshaw, Richard
Healey, Rt. Hn. Denis
Mackenzie, Gregor


Cronin, John
Heffer, Eric S.
Mackie, John


Crosland, Rt. Hn. Anthony
Hilton, W. S.
Mackintosh, John P.


Crossman, Rt. Hn. Richard
Hooson, Emlyn
Maclennan, Robert


Cunningham, G. (Islington, S.W.)
Horam, John
McMaster, Stanley


Davies, Denzil (Llanelly)
Houghton, Rt. Hn. Douglas
McMillan, Tom (Glasgow, C.)


Davies, Ifor (Gower)
Howell, Denis (Small Heath)
McNamara, J. Kevin


Davis, Clinton (Hackney, C.)
Huckfield, Leslie
Maginnis, John E.


Davis, Terry (Bromsgrove)
Hughes, Rt. Hn. Cledwyn (Anglesey)
Mahon, Simon (Bootle)


Deakins, Eric
Hughes, Mark (Durham)
Mallalieu, J. P. W. (Huddersfield. E.)


de Freitas, Rt. Hn. Sir Geoffrey
Hughes, Robert (Aberdeen, N.)
Marks, Kenneth







Marsden, F.
Pentland, Norman
Stoddart, David (Swindon)


Marshall, Dr. Edmund
Perry, Ernest G.
Stonehouse, Rt. Hn. John


Marten, Neil
Powell, Rt. Hn. J. Enoch
Strang, Gavin


Mason, Rt. Hn. Roy
Prentice, Rt. Hn. Reg.
Strauss, Rt. Hn. G. R.


Mayhew, Christopher
Prescott, John
Summerskill, Hn. Dr. Shirley


Meacher, Michael
Price, J. T. (Westhoughton)
Swain, Thomas


Mellish, Rt. Hn. Robert
Price, William (Rugby)
Thomas, Jeffrey (Abertillery)


Mendelson, John
Probert, Arthur
Thomson, Rt. Hn. G. (Dundee, E.)


Mikardo, Ian
Rankin, John
Tinn, James


Millan, Bruce
Reed, D. (Sedgefield)
Tomney, Frank


Miller, Dr. M. S.
Rees, Merlyn (Leeds, S.)
Torney, Tom


Milne, Edward
Rhodes, Geoffrey
Turton, Rt. Hn. Sir Robin


Mitchell, R. C. (S'hampton, Itchen)
Richard, Ivor
Urwin, T. W.


Moate, Roger
Roberts, Albert (Normanton)
Varley, Eric G.


Molloy, William
Roberts, Rt.Hn.Goronwy(Caernarvon)
Wainwright, Edwin


Molyneaux, James
Robertson, John (Paisley)
Walden, Brian (B'm'ham, All Saints)


Morgan, Elystan (Cardiganshire)
Roderick, Caerwyn E.(Br'c'n&amp;R'dnor)
Walker, Harold (Doncaster)


Morris, Alfred (Wythenshawe)
Rodgers, William (Stockton-on-Tees)
Walker-Smith, Rt. Hn. Sir Derek


Morris, Charles R. (Openshaw)
Roper, John
Wallace, George


Morris, Rt. Hn. John (Aberavon)
Rose, Paul B.
Watkins, David


Moyle, Roland
Ross, Rt. Hn. William (Kilmarnock)
Weitzman, David


Mulley, Rt. Hn. Frederick
Rowlands, Ted
Wellbeloved, James


Murray, Ronald King
Russell, Sir Ronald
Wells, William (Walsall, N.)


Oakes, Gordon
Sandelson, Neville
White, James (Glasgow, Pollok)


Ogden, Eric
Sheldon, Robert (Ashton-under-Lyne)
Whitehead, Phillip


O'Halloran, Michael
Shore, Rt. Hn. Peter (Stepney)
Whitlock, William


O'Malley, Brian
Short,Rt.Hn.Edward(N'c'tle-u-Tyne)
Willey, Rt. Hn. Frederick


Oram, Bert
Silkin, Rt. Hn. John (Deptford)
Williams, Alan (Swansea, W.)


Orme, Stanley
Silkin, Hn. S. C. (Dulwich)
Williams, Mrs. Shirley (Hitchin)


Oswald, Thomas
Sillars, James
Williams, W. T. (Warrington)


Owen, Or. David (Plymouth, Sutton)
Silverman, Julius
Wilson, Alexander (Hamilton)


Paget, R. T.
Skinner, Dennis
Wilson, William (Coventry, S.)


Palmer, Arthur
Small, William
Wool, Robert


Pannell, Rt. Hn. Charles
Smith, John (Lanarkshire, N.)



Parker, John (Dagenham)
Spearing, Nigel
TELLERS FOR THE NOES:


Parry, Robert (Liverpool, Exchange)
Spriggs, Leslie
Mr. James A. Dunn and


Peart, Rt. Hn. Fred
Stallard, A. W.
Mr. John Golding.


Pendry, Tom

Question accordingly agreed to.

Clause 7 ordered to stand part of the Bill.

[SIR MYER GALPERN in the Chair]

Mr. Molloy: On a point of order, Sir Myer. We are rapidly approaching, if we have not already reached, a situation of abysmal absurdity in the Committee stage of the Bill. The whole idea of a Committee stage is to enable hon. Members to express apprehensions or doubts with regard to the drafting of a Bill and to table Amendments. Does any hon. Member know of a Bill of such importance, of such tremendous calibre, with its effect on the nation and the House, that has never been amended?
In the previous debate we heard arguments both by those who are passionately in favour of our joining the Common Market and by Members opposed to them, whose views converged on certain aspects of the Bill which they felt should be changed. We have been going through the farce of putting arguments in support of Amendments. Various Ministers have sometimes admitted the validity of the Amendments, but despite the importance of the Bill the Government have decided

that, come what may, there will be no Report stage, and so all the arguments and Amendments have been completely disregarded from the very beginning. If from the beginning the Government did not intend to have a Report stage, the Committee stage is an utter farce. The nation will regard it as such, and the status of the House will be lowered.
Therefore, as we are approaching the end of this farcical, unrealistic Committee stage, to try to save the name of the House an approach should be made to Mr. Speaker and the Government Front Bench to say that we cannot go on in this ridiculous way, having a Bill which must be immaculate in every respect—every dot and comma. I do not think there has been a precedent in the history of Parliament. [Interruption.] Notwithstanding that the question of whether Britain joins the EEC obviously affords amusement to some members of the Government Front Bench, there are those with grave apprehensions, and many hon. Members who are in favour of entry but are worried about certain aspects of the Bill, and would like to see it changed. Therefore, official representations should be made, so that we know that even in these last days of the Committee stage


there may be a possibility of having very important Amendments made in the right and proper manner, in accordance with our rules of procedure.
The Temporary Chairman: The hon. Gentleman has correctly stated the purpose of a Commitee stage, but while the Chair has certain authority and powers they do not include the right to compel the Government to take a certain course of action.

Clause 4

GENERAL PROVISION FOR REPEAL AND AMENDMENT

Mr. Stanley R. McMaster: I beg to move Amendment No. 467, in page 6, line 13, at end insert:
Provided that no provision affecting the Safeguarding of Employment Act 1947 of the Parliament of Northern Ireland shall be so made otherwise than in pursuance of a resolution of each House of the Parliament of Northern Ireland".
In the White Paper dealing with the Treaty of Rome the Government said that for Northern Ireland they had
sought a five-year transitional period before the application of the Community's requirements on free movement of labour.…We have also stated that it may well be necessary towards the end of the five years to consider whether, and if so what, further special measures will still be needed.
That was incorporated in the treaty, which provides in paragraph VII, dealing with social policy, on page 154 of Volume II, that
Ireland and the United Kingdom of Great Britain and Northern Ireland shall have the right to retain, up to and including 31 December 1977, their national provisions requiring a prior authorization for immigration into Ireland and Northern Ireland of nationals of the other Member States for the purposes of taking up employment and/or for access by such nationals to employment in Ireland and Northern Ireland.
I have raised this point relating to the Safeguarding of Employment Act on other occasions, most recently on 14th June, when my right hon. Friend the Chancellor of the Duchy of Lancaster said in reply to the debate on the Question "That Clause 2 stand part of the Bill":
So I can give my hon. Friend the assurance that there is no difficulty about the position up to 1977, and we have made it perfectly clear that

we may need to revert to this and provide for an extension of the Safeguarding of Employment Act, 1947. This is well understood by the Community and I think that we are in a good position to defend our interests in that regard."—[OFFICIAL REPORT, 14th June, 1972; Vol. 838, c. 1588.]
What concerns the Ulster Members is the use of the word "may" in "we may need to revert to this". My hon. and learned Friend states that this is well understood by the Community, but there is nothing which I can find in the treaty or elsewhere where this is made binding upon the Community. This is a matter of vital interest to the Republic of Ireland, which is seeking to join the Common Market at the same time. I am concerned in case in 1977 it uses what powers it will then have to block any attempt by the United Kingdom to extend this provision for a further five years.
I welcome the assurance of my right hon. and learned Friend, but I am concerned about the possibility that a change in Government or even in Ministers may mean that this assurance would lose some of its strength. I am concerned about the powers that other countries may have to prevent this country from extending the Safeguarding of Employment Act.
We in Ulster suffer from heavy unemployment which runs between 8 per cent, and 11 per cent. It has been persistently heavy ever since the war. It is caused basically by the run-down in our main industries, the agriculture industry on which we are mainly dependent in Northern Ireland, and also heavy industry, shipbuilding in particular. As a result of mechanisation and automation the number of people employed in these industries in Ulster has been decreasing and continues to decrease at a high rate, in spite of improvements in productivity. This throws a lot of men on the labour exchange. They must be absorbed by the industries we already have and by new industries which we hope to attract.
Unfortunately, as a result of the terrorist campaign over the last three years, industry has been badly damaged in Northern Ireland. Many firms have been destroyed, their premises literally blown up by the terrorists. As a result, many jobs have been lost. In addition, our ordinary firms which would have expanded in the last two or three years have not been able to do so. We normally hope to attract industry providing for about 20,000


to 30,000 new jobs a year, but these have not been coming to Northern Ireland because of the troubles.
We all welcome the ceasefire which occurred last night and hope it will lead to a period of peace. However, it will be a considerable time before we get back to normal, and even then "normal" for us is a state of heavy unemployment. It will be more than five years, I venture to suggest, before we are in a position to do without the legislation in the Safeguarding of Employment Act. It will take many years to rebuild our industries, to recreate confidence in Northern Ireland and to tackle the main problems behind the disturbances with which we are plagued in Ulster. Therefore, I view the position as provided by the Government in their negotiations as unsatisfactory. Other provisions covering other matters have been dealt with by protocol with, for example, New Zealand and Norway and the question of sugar. Here the long-term future has been kept open. I would refer to Protocols Nos. 17, 18 and 20. With Northern Ireland there is no such protocol; there is nothing to protect us in the long run.
The situation is that under Clause 2 the provisions relating to the Safeguarding of Employment Act will come to an end automatically in 1977. Hence the wording of the Amendment, and I thank those who have helped me in drafting it. The Amendment is to be inserted in Clause 4 so that there would not be an automatic ending of the safeguarding of employment legislation. The Safeguarding of Employment Act and its provisions would remain in existence in Northern Ireland unless a Resolution to the contrary were passed by each of the two Houses of Parliament in Northern Ireland. Those Houses are now in suspension, but the Government have promised that they will be restored at the end of the year, and I sincerely hope that they will keep their promise.

Mr. Stanley Orme: That is not true.

Mr. McMaster: This Amendment is essential to protect Northern Ireland's position.
I am further concerned in view of certain statements which have been made in Dublin. It is suggested that the safe-

guarding of employment legislation will remain in Northern Ireland only for the transitional period of five years and that there will be no question of it being renewed. There is a conflict of evidence here between what my right hon. and learned Friend has told me from the Front Bench and what has been openly said in Dublin to be the effect of Britain and the Republic of Ireland becoming members of the Common Market.
This is a vital matter for the welfare and well-being of Northern Ireland and one which has political implications, dealing with the rights of people who may be attracted from the South of Ireland to Northern Ireland. I am not dealing with those who may want to come from the south of Italy; I am much more concerned with those who may want to make the short journey across the border. These people will have full voting rights in Northern Ireland and they could easily upset the delicate political balance in a way which could lead to a revival of terrorist activity. This is an additional reason for the concern with which people living in Northern Ireland view the prospect of Britain joining the Common Market without some further protection.
I ask my right hon. and learned Friend with all the force that I can summon to consider accepting this Amendment in the light of the promises he has already made to Ulster Members. Let him give us the assurance that what he has said in the House will be written into legislation. I know that his assurances are in HANSARD but who, in five or six years' time, will look back to see what was said in HANSARD? In any event, what binding force will it have? This is a matter of great concern in Northern Ireland. We are extremely disappointed that it has not been incorporated in a protocol to the treaty, as have many other matters. In the light of these facts I ask my right hon. and learned Friend to consider amending Clause 4 so that this point will be properly met.

Mr. James Kilfedder: I join with my hon. Friend the Member for Belfast, East (Mr. McMaster) in pleading with the Government, if they will pay heed to pleas, to think again and accept this reasonable Amendment which is moved in the interests of all in Northern Ireland.
My right hon. and learned Friend the Chancellor of the Duchy of Lancaster has said that he has made it clear to the Community that there may be a need to revert to the Safeguarding of Employment Act after the end of 1977. He says that the Community will—perhaps I should not say "will"—or may accept this. However, there is no assurance and, from the way in which the members of the Community already work and behave, when our time comes to seek help from it on 1st January, 1978, I doubt whether many people will be willing to assist Northern Ireland, which is a country like Scotland on the periphery of the Community. I fear that Ulster, like Scotland, will suffer once it enters the Community.
Therefore, it is right for hon. Members from Northern Ireland to express their concern and plead with the Government to agree to the Amendment. The heed which the Community has taken of my right hon. and learned Friend's remarks is not binding in any way. It is not binding on the Eire Government, whose politicians are on record as saying that the Safeguarding of Employment Act will come to an end, after the transitional period, at the end of 1977.
I agree with what my hon. Friend has said about the Government's negotiations. I am not permitted to go outside that, but the Government's negotiations on this matter are far from satisfactory. The Government were able to obtain longer periods of protection for other interests. I forget what protection was given to the fishing industry, but certainly other interests have received considerable protection. It is not unreasonable for charity to begin at home with the protection of the people of Northern Ireland.
Ulster has suffered heavily from unemployment. This is a curse which will remain with us for a considerable time. We have had our industries in Ulster blasted by the IRA terrorists, who have tried to bring our community to its knees. It will be a considerable time before we are able to bring the economic life of the community back to what it was before and, indeed, to go ahead and improve upon it so that we can wipe out unemployment, which is a terrible curse for any land to bear. It is a problem which causes distress to everyone inside

the Province. The violence which the IRA has displayed has effectively deterred a number of potential employers from setting up businesses in Northern Ireland.
The Government should be mindful of the situation, although I readily accept that they have been generous and will be generous in providing financial assistance. None the less, it is ridiculous to believe that the pumping in of millions of pounds will help Northern Ireland if the Safeguarding of Employment Act comes to an end. Once the Act comes to an end the people from the Republic will be able to flow across the border into Northern Ireland.
8.15 p.m.
Stormont has spent tens of millions of pounds on new industries, incentive schemes, rate relief for new factories and industrial training. Since the suspension of Stormont on 24th March, the House has sanctioned £39 million for Harland & Wolff, £107 million for development in Londonderry,£50 million for the Northern Ireland Finance Corporation and £18½ million for the accelerated building programme. My right hon. Friend the Secretary of State for Northern Ireland has announced another building programme which is under construction. We hope that these schemes will have an impact on the 10 per cent. unemployment rate. They are vast sums of money, and the British taxpayer will not tolerate a situation in which hundreds of millions of pounds are to be spent in Ulster without the assurance that the people of Northern Ireland will benefit.
The Safeguarding of Employment Act gives the assurance that only the people of Ulster will benefit. The money has not been provided to create employment opportunities for people from Eire. That would defeat the whole purpose of the various financial aid schemes which exist to solve the unemployment problem.
It should be remembered that the Safeguarding of Employment Act was brought in after the war to try to deal with a sad situation. There was no conscription in Northern Ireland during the war; therefore it was easy for people from the Republic to cross the border, knowing that they would be safe from conscription. Although many people from the Republic joined the Forces, a considerable number


of people from Northern Ireland did so, too. When they came back, as their forebears came back after the 1914–18 war, their jobs had been taken by people from the Republic who had set up homes there. They had no jobs to go to and there were no new homes to go to. Thus, having fought the war for democracy, they found that they were facing the dole in Northern Ireland. That was their payment.
I ask the Government to look at this matter—I appreciate that the Government are reluctant to accept Amendments, but there is need of a Report stage on this very important Bill—and to think in terms of the human situation in Northern Ireland and what the cessation of the Act will mean for the people in Northern Ireland and the loss of their jobs to people in the Republic and, perhaps, their homes as well. Therefore, I ask the Government not only to help by pumping money into Northern Ireland but also to accept the Amendment and ensure that the Safeguarding of Employment Act will remain in effect after 1977, which would give the Ulster people time to make the transition from poverty and unemployment to a prosperous community. After the transition I trust that for a long time Ulster will be a prosperous and peaceful part of the United Kingdom.

Mr. Rafton Pounder: I do not propose to detain the Committee for more than a few moments. It is not my intention to duplicate the points which have already been well expressed by my hon. Friends the Members for Belfast, East (Mr. McMaster) and Down, North (Mr. Kilfedder).
From my experience in Belfast, talking to people in various walks of the commercial life of the community, one of the points which I have found throughout recent months to have occupied their concern and attention more than any other aspect of the EEC negotiations and of the present Bill is the Safeguarding of Employment Act.
One of the matters which have frequently been raised in debates on Northern Ireland in the House has been the fact, which is perfectly true, that the average wage rates in Northern Ireland are slightly lower than they are for corresponding industries on this side of the Irish sea. If we were to add to that the

free mobility of labour which would almost certainly flow across the border in the event of no protection to employment in Northern Ireland being granted, bearing in mind that wage rates in the Irish Republic are considerably lower than in Ulster, we would have the makings of continuing a depressed economic situation in Northern Ireland, and depressed wage rates would certainly continue as there would be no incentive for them to alter. Indeed, far from making the best use of the generous financial assistance which has been given to Northern Ireland in recent years, we would be continuing and perpetuating, virtually in-building, a fairly high unemployment rate.
I realise that under the Government of Ireland Act, 1920, Northern Ireland was not granted treaty-making powers. I am not suggesting that we should draw up our own arrangements in Northern Ireland vis-à-vis the EEC. That is not the case.
What is the problem? My hon. Friend the Member for Belfast, East raised part of the issue. I shall take the other part. We have been told that there is a guarantee of the continuance of the Act until the end of 1977, when it may need an extension. That causes uncertainty, which is regrettable. But, even more important, is: who will determine whether an extension is necessary?
The White Paper was not clear on this matter. The parliamentary assembly in Northern Ireland is obviously the best judge whether the economic situation in the Province justifies an extension for a further period. Bearing in mind that the Safeguarding of Employment Act has been essential for over 20 years and adding to that the problems which have inevitably arisen economically in the past three years as a consequence of terrorist activity, I should think that even at this stage it would be patently obvious that the five years already granted will be shown to be palpably inadequate.
The worst possible thing is for Northern Ireland to be put in the position that pertains in Southern Italy, where a special unemployment problem exists and the period of extension given has been virtually on a grace and favour basis. I understand that it has now been going for 13 years. We want something slightly


clearer and crisper than, "We will see how it goes, and perhaps we can extend the period for another five years or on an annual basis." We must have it clearly stated that the minimum period will be, say, 10 years and thereafter can be reviewed on a fixed term of years. That would be a matter for the Parliament or whatever legislative assembly returns to Northern Ireland in the course of the next 12 months. I warmly commend the Amendment to the Committee.

Mr. James Molyneaux: Like my hon. Friend the Member for Down, North (Mr. Kilfedder), I feel that this is not a sectarian matter in any shape or form. The fact that Opposition Members representing Northern Ireland constituencies have not added their names to the Amendment and are not present should not lead anyone to the conclusion that this is a one-party consideration. Indeed, it is a bread-and-butter matter. It is concerned with freedom from want. As such I know that it will particularly appeal to hon. Gentlemen opposite, many of whom have concerned themselves with the problems of unemployment and social conditions generally in Northern Ireland. We are grateful for their support on many occasions.
It has been the widely held view that somehow or other the unrest in Northern Ireland has been due, at least in some measure, to social conditions and unemployment. That is not a view to which I subscribe. It is not a major factor but, unfortunately, many people take that view. If so, they are bound to feel that the very possibility of ending the Safeguarding of Employment Act, even in five years' time, will do a great deal to perpetuate the conditions and the consequences which they so greatly fear.
Finally, I suggest that the people in the best position to judge whether the Safeguarding of Employment Act should be renewed at the end of the five-year transitional period are the elected representatives of the people of Northern Ireland in their own Parliament at Stormont. They are in day-to-day contact with their constituents and with people generally in industry. I submit therefore that they are in the best position to judge and should have the right to decide.

The Minister of State for Northern Ireland (Mr. Paul Channon): I am sure the whole Committee is well aware of the great importance to Northern Ireland of the Safeguarding of Employment Act, 1947, and in particular of the keen efforts of my hon. Friends who have raised this subject not only on this occasion but in the past in protecting, as they see it, the interests of their constituents both in and outside the Committee.
I agree with my hon. Friend the Member for Down, North (Mr. Kilfedder) about the need to build a peaceful and prosperous community in Northern Ireland. It is the responsibility of all to try to do what we can to achieve that object. It would not be in order for me this evening to go into the steps necessary to achieve that end but I certainly understand the fears which have been expressed about the Act.
Although we all know of the appalling toll which has been taken in Northern Ireland during the past three years of terrorist activity, the Committee should be aware—Iam sure that my hon. Friend the Member for Belfast, East (Mr. McMaster) is—of the astonishing resilience of that community despite the ghastly attacks which have been made upon it.
My hon. Friend must not paint too black a picture. I have spent most of the afternoon trying to persuade businessmen to invest in and to buy goods from Northern Ireland. I have told them how, despite the ghastly things which have taken place there, Northern Ireland industry has been comparatively little harmed and is able to deliver goods on time and that production is possible. Although my hon. Friend was right to paint the difficulties which lie ahead, it is astonishing and gratifying to note the resilience of the community despite the appalling difficulties it has had to face in the past.
My hon. Friend has raised the future of the Safeguarding of Employment Act, 1947. I accept that the important question is the future of the Act but I should point out that the Amendment, if carried, would not be relevant to Clause 4. The Clause deals with the general provision for repeal and amendment so far as it relates to the later Clauses or, indeed, the paragraphs of Schedule 4.
As I understand the Bill, it does not relate in any way to the question of the


Safeguarding of Employment Act. Therefore, even if we wished to accept the spirit of the Amendment this would not be the place for it, because Clause 4 does not relate to that portion of the Bill which is concerned with this topic. I do not make much of that point but I think it is worth making.

Mr. Kilfedder: My hon. Friend indicates that he accepts the spirit of the Amendment which we are putting forward. That is what I was assuming. I therefore ask, even if this is not the appropriate place, whether my hon. Friend would put forward or assist us in putting forward an Amendment which would preserve the safeguarding of Employment Act for Northern Ireland.

Mr. Channon: I am afraid my hon. Friend has misunderstood the extent of my sympathy. I do not think that any such Amendment is necessary. All I am saying as a preliminary is that, even if it were necessary, Clause 4 would not be the place in which it would be appropriate to have any such Amendment.
The Committee will know that Her Majesty's Government and successive Governments have been deeply concerned about the unemployment problem in Northern Ireland and, as my hon. Friends have said perfectly clearly, they have been giving very generous help and assistance to Northern Ireland. This will continue, because it is the wish of hon. Members on both sides of the Committee that as far as possible we should give sufficient assistance to Northern Ireland to help to overcome its deep-seated unemployment problems, which are extremely acute and have been for a very long time.
8.30 p.m.
It is for that very reason that my right hon. and learned Friend, during the discussions leading up to the signing of the treaty, negotiated the derogation which is given in paragraph 144 of the White Paper "The United Kingdom and the European Communities". My hon. Friend quoted from that or some other document relating to this, I think. My right hon. and learned Friend has made clear again and again and as recently as last week the feeling that Her Majesty's Government have about the importance of this matter and how there will be no

difficulty whatever about the position up to 1977. Full consultations will certainly take place when the position is reconsidered prior to renewed negotiations, which may prove to be necessary when we are a member of the Community and are approaching the terminal date of the Safeguarding of Employment Act if the derogation is not to be continued. At that time it will be a matter for Her Majesty's Government, in consultation with those representing Northern Ireland, to decide whether or not a further extension of the derogation is necessary and right. That will be the appropriate time for Her Majesty's Government to put forward the suggestion to the European Communities that there should be an extension of the derogation.
My right hon. and learned Friend has made quite clear the very great importance he attaches to this matter. We are certainly prepared to revert to it within the institutions of the enlarged Community at the appropriate time, but that will depend both on the situation in Northern Ireland and on what progress has been made by the Community in regional policy generally. It is far too early now, on 27th June, 1972, to say that we know for certain what the situation will be at the end of 1977 and to decide tonight that it is essential that there be a further period of derogation, when the initial period has not even begun.
So I do not think I can help my hon. Friends as much as I would like because, as my hon. Friend the Member for Belfast, South (Mr. Pounder) pointed out, the Parliament of Northern Ireland has never had the power to make treaties; that has always been a matter which has been referred, rightly or wrongly, to the United Kingdom Parliament. It is the responsibility of the United Kingdom Parliament to consider the interests of all sections of the United Kingdom, including a most important section of it, the Northern Irish community, and their views and feelings on this particular matter.
My right hon. and learned Friend has made it clear that we shall certainly take very seriously the views that have been expressed and will not hesitate to put this point of view to the Community at the appropriate time should circumstances in Northern Ireland indicate that


it is right so to do. My right hon. and learned Friend gave an assurance to the Committee last week and assurances have been given on many occasions in the past on this particular matter.

Mr. Powell: I wonder whether my hon. Friend would be good enough to answer this question. As he has just said, my right hon. and learned Friend the Chancellor of the Duchy of Lancaster said on 14th June:
we may need to…provide for an extension"—
that is, after 1977—
of the Safeguarding of Employment Act, 1947."—[OFFICIAL REPORT, 14th June, 1972; Vol. 838, c. 1588.]
I would ask my hon. Friend whether such a need would be regarded as a vital national interest and, if so, what would be the effect of the use of a veto?

Mr. Channon: It would be wrong for me to answer what I think my right hon. Friend would concede at this stage is a wholly hypothetical question.

Mr. Powell: No.

Mr. Channon: I cannot now tell whether it will be necessary to have an extension of the safeguards of the 1947 Act. Nor can I tell now whether it will be regarded as a vital matter at the appropriate time. I cannot add to what my right hon. and learned Friend the Chancellor of the Duchy of Lancaster said—that we may need to refer to this again and provide for an extension of the safeguards. This is well understood by the Community and we are in a good position to defend our interests in this respect. That is our ultimate protection, particularly for Northern Ireland.

I assure the Committee that the Government consider this to be an extremely important matter. They will bear in mind the views of Northern Ireland and will consider the situation in plenty of time, so that if further derogation is necessary negotiations can begin at the appropriate moment.

I hope that in the light of the assurances I have given and, more important, in the light of those given by my right hon. and learned Friend and other Ministers on many occasions, my hon. Friends will feel, while not wholly satisfied, at least that the Government are determined to safeguard the interests of Northern Ireland.

Mr. McMaster: I thank my hon. Friend for his reply and I am glad that he and my right hon. and learned Friend the Chancellor of the Duchy of Lancaster have sat throughout the debate, which we consider to have been most important. I am not completely satisfied with the reply. This is a fundamentally important matter not only to Ulster but to the United Kingdom as a whole for the reasons we have advanced. It should have been covered in the Bill or by a protocol to the treaty. However, I welcome some of the assurances I have received, particularly those which my right hon. and learned Friend gave me a week ago. In view of those assurances, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Question put, That the Clause stand part of the Bill: —

The Committee divided:  Ayes 259. Noes 249.

Division No. 248.]
AYES
[8.40 p.m.


Adley, Robert
Bowden, Andrew
Chataway, Rt. Hn. Christopher


Alison, Michael (Barkston Ash)
Braine, Sir Bernard
Chichester-Clark, R.


Allason, James (Hemel Hempstead)
Bray, Ronald
Clark, William (Surrey, E.)


Archer, Jeffrey (Louth)
Brinton, Sir Tatton
Clegg, Walter


Astor, John
Brocklebank-Fowler, Christopher
Cockeram, Eric


Atkins, Humphrey
Brown, Sir Edward (Bath)
Cooke, Robert


Awdry, Daniel
Bruce-Gardyne, J.
Cooper, A. E.


Baker, Kenneth (St. Marylebone)
Bryan, Sir Paul
Corfield, Rt. Hn. Sir Frederick


Balniel, Rt. Hn. Lord
Buchanan-Smith, Alick (Angus,N&amp;M)
Cormack, Patrick


Batsford, Brian
Buck, Antony
Costain, A. P.


Beamish, Col. Sir Tufton
Burden, F. A.
Critchley, Julian


Bennett, Dr. Reginald (Gosport)
Butler, Adam (Bosworth)
Crouch, David


Benyon, W.
Campbell, Rt. Hn. G.(Moray &amp; Nairn)
Crowder, F. P.


Berry, Hn. Anthony
Carlisle, Mark
Davies, Rt. Hn. John (Knutsford)


Biggs-Davison, John
Carr, Rt. Hn. Robert
d'Avigdor-Goldsmid, Sir Henry


Blaker, Peter
Cary, Sir Robert
d'Avigdor-Goldsmid, Maj.-Gen. James


Boardman, Tom (Leicester, S.W.)
Channon, Paul
Dean, Paul


Boscawen, Robert
Chapman, Sydney
Deedes. Rt. Hn. W. F.




Dixon, Piers
Kershaw, Anthony
Ramsden, Rt. Hn. James


du Cann, Rt. Hn. Edward
King, Evelyn (Dorset, S.)
Rawlinson, Rt. Hn. Sir Peter


Dykes, Hugh
King, Tom (Bridgwater)
Redmond, Robert


Eden, Sir John
Kinsey, J. R.
Reed, Laurance (Bolton, E.)


Edwards, Nicholas (Pembroke)
Kirk, Peter
Rees, Peter (Dover)


Elliot, Capt. Walter (Carshalton)
Kitson, Timothy
Rees-Davies, W. R.


Elliott, R. W. (N'c'tle-upon-Tyne,N.)
Knight, Mrs. Jill
Renton, Rt. Hn. Sir David


Emery, Peter
Knox, David
Rhys Williams, Sir Brandon


Eyre, Reginald
Lambton, Lord
Ridley, Hn. Nicholas


Fenner, Mrs. Peggy
Lamont, Norman
Ridsdale, Julian


Fidler, Michael
Lane, David
Rippon, Rt. Hn. Geoffrey


Finsberg, Geoffrey (Hampstead)
Legge-Bourke, Sir Harry
Roberts, Michael (Cardiff, N.)


Fisher, Nigel (Surbiton)
Le Marchant, Spencer
Roberts, Wyn (Conway)


Fletcher-Cooke, Charles
Lewis, Kenneth (Rutland)
Rost, Peter


Fookes, Miss Janet
Lloyd, Ian (P'tsm'th, Langstone)
Sandys, Rt. Hn. D.


Fortescue, Tim
Longden, Sir Gilbert
Scott, Nicholas


Foster, Sir John
Loveridge, John
Sharples, Richard


Fowler, Norman
Luce, R. N.
Shaw, Michael (Sc'b'gh &amp; Whitby)


Fox, Marcus
McAdden, Sir Stephen
Shelton, William (Clapham)


Fry, Peter
MacArthur, Ian
Simeons, Charles


Galbraith. Hn. T. G.
McCrindle, R. A.
Skeet, T. H. H.


Gibson-Watt, David
McLaren, Martin
Smith, Dudley (W'wick &amp; L'mington)


Gilmour, Ian (Norfolk, C.)
Maclean, Sir Fitzroy
Soref, Harold


Gilmour, Sir John (Fife, E.)
Macmillan.Rt.Hn.Maurice (Farnham)
Speed, Keith


Glyn, Dr. Alan
McNair-Wilson, Michael
Spence, John


Godber, Rt. Hn. J. B.
McNair-Wilson, Patrick (NewForest)
Sproat, Iain


Goodhart, Philip
Maddan, Martin
Stainton, Keith


Goodhew, Victor




Gorst, John
Madel, David
Stanbrook, Ivor


Gower, Raymond
Mather, Carol
Stewart-Smith, Geoffrey (Belper)


Grant, Anthony (Harrow, C.)
Maudling, Rt. Hn. Reginald
Stodart, Anthony (Edinburgh, W.)


Gray, Hamish
Mawby, Ray
Stoddart-Scott, Col. Sir M.


Green, Alan
Maxwell-Hyslop, R. J.
Stokes, John


Griffiths, Eldon (Bury St. Edmunds)
Meyer, Sir Anthony
Stuttaford, Dr. Tom


Grimond, Rt. Hn. J.
Mills, Peter (Torrington)
Tapsell, Peter


Grylls, Michael
Mills, Stratton (Belfast, N.)
Taylor, Sir Charles (Eastbourne)


Gummer, J. Selwyn
Miscampbell, Norman
Taylor, Robert (Croydon, N.W.)


Gurden, Harold
Mitchell, Lt.-Col.C.(Aberdeenshire,W.)
Tebbit, Norman


Hall, Miss Joan (Keighley)
Mitchell, David (Basingstoke)
Temple, John M.


Hall, John (Wycombe)
Money, Ernle
Thatcher, Rt. Hn. Mrs. Margaret


Hall-Davis, A. G. F.
Monks, Mrs. Connie
Thomas, John Stradling (Monmouth)


Hamilton, Michael (Salisbury)
Monro, Hector
Thomas, Rt. Hn. Peter (Hendon, S.)


Hannam, John (Exeter)
Montgomery, Fergus
Thompson, Sir Richard (Croydon, S.)


Harrison, Brian (Maldon)
More, Jasper
Tilney, John


Harrison, Col. Sir Harwood (Eye)
Morgan, Geraint (Denbigh)
Trafford, Dr. Anthony


Haselhurst, Alan
Morrison, Charles
Trew, Peter


Havers, Michael
Mudd, David
Tugendhat, Christopher


Hawkins, Paul
Murton, Oscar
van Straubenzee, W. R.


Hayhoe, Barney
Neave, Airey
Vaughan, Dr. Gerard


Heseltine, Michael
Nicholls, Sir Harmar
Vickers, Dame Joan


Hicks, Robert
Noble, Rt. Hn. Michael
Waddington, David


Higgins, Terence L.
Normanton, Tom
Walker, Rt. Hn. Peter (Worcester)


Hiley, Joseph
Nott, John
Ward, Dame Irene


Hill, John E. B. (Norfolk, S.)
Onslow, Cranley
Warren, Kenneth


Hill, James (Southampton, Test)
Oppenheim, Mrs. Sally
Wells, John (Maidstone)


Holland, Philip
Osborn, John
White, Roger (Gravesend)


Holt, Miss Mary
Owen, Idris (Stockport, N.)
Wiggin, Jerry


Hordern, Peter
Page, Rt. Hn. Graham (Crosby)
Wilkinson, John


Hornby, Richard
Page, John (Harrow, W.)
Winterton, Nicholas


Hornsby-Smith.Rt.Hn.Dame Patricia
Parkinson, Cecil
Wolrige-Gordon, Patrick


Howe, Hn. Sir Geoffrey (Reigate)
Percival, Ian
Wood, Rt. Hn. Richard


Howell, Ralph (Norfolk, N.)
Peyton, Rt. Hn. John
Woodhouse, Hn. Christopher


Hunt, John
Pike, Miss Mervyn
Woodnutt, Mark


Iremonger, T. L.
Pink, R. Bonner
Worsley, Marcus


James, David
Price, David (Eastleigh)
Wylie, Rt. Hn. N. R.


Jenkin, Patrick (Woodford)
Prior, Rt. Hn. J. M. L.
Younger, Hn. George


Johnson Smith, G. (E. Grinstead)
Proudfoot, Wilfred



Jones, Arthur (Northants, S.)
Pym, Rt. Hn. Francis
TELLERS FOR THE AYES: 


Jopling, Michael
Ouennell, Miss J. M.
Mr. Bernard Weatherill and


Joseph, Rt. Hn. Sir Keith
Raison, Timothy
 Mr. Kenneth Clarke.


Kellett-Bowman, Mrs. Elaine






NOES


Abse, Leo
Baxter, William
Brown, Bob (N'c tle-upon-Tyne,W.)


Allaun, Frank (Salford,
Bonn, Rt. Hn. Anthony Wedgwood
Brown, Hugh D. (Glasgow, Provan)


Allen, Scholefield
Bennett, James (Glasgow, Bridgeton)
Brown, Ronald (Shoreditch S F'bury)


Archer, Peter (Rowley
Bidwell, Sydney
Buchan, Norman


Armstrong, Ernest
Bitten, John
Buchanan, Richard (G'gow, Sp'burn)


Ashley, Jack
Bishop, E. S.
Butler, Mrs. Joyce (Wood Green)


Ashton, Joe
Boardman, H. (Leigh)
Campbell, I. (Dunbartonshire, W.)


Atkinson, Norman
Body, Richard
Cant, R. B.


Bagier, Gordon A. T.
Booth, Albert
Carmichael, Neil


Barnett, Guy (Greenwich)
Bottomley, Rt. Hn. Arthur
Carter, Ray (Birmingham, Northfield)


Barnett, Joel (Heywood and Royton)
Boyden, James (Bishop Auckland)
Castle, Rt. Hn. Barbara







Clark, David (Colne Valley)
Jones, Barry (Flint, E.)
Peart, Rt. Hn. Fred


Cocks, Michael (Bristol, S.)
Jones, Dan (Burnley)
Pendry, Tom


Cohen, Stanley
Jones, Gwynoro (Carmarthen)
Pentland, Norman


Concannon, J. D.
Jones, T. Alec (Rhondda, W.)
Perry, Ernest G.


Cox, Thomas (Wandsworth, C.)
Kaufman, Gerald
Pounder, Rafton


Cronin, John
Kelley, Richard
Powell, Rt. Hn. J. Enoch


Crosland, Rt. Hn. Anthony
Kerr, Russell
Prentice, Rt. Hn. Reg.


Crossman, Rt. Hn. Richard
Kilfedder, James
Prescott, John


Cunningham, G. (Islington, S.W.)
Kinnock, Neil
Price, J. T. (Westhoughton)


Davies, Denzil (Llanelly)
Lambie, David
Price, William (Rugby)


Davles, Ifor (Gower)
Lamborn, Harry
Probert, Arthur


Davis, Clinton (Hackney, C.)
Lamond, James
Rankin, John


Davis, Terry (Bromsgrove)
Latham, Arthur
Reed, D. (Sedgefield)


Deakins, Eric
Leadbitter, Ted
Rees, Merlyn (Leeds, S.)


de Freitas, Rt. Hn. Sir Geoffrey
Lee, Rt. Hn. Frederick
Rhodes, Geoffrey


Dell, Rt. Hn. Edmund
Leonard, Dick
Richard, Ivor


Dempsey, James
Lever, Rt. Hn. Harold
Roberts, Rt.Hn.Goronwy (Caernarvon)


Doig, Peter
Lewis, Arthur (W. Ham, N.)
Robertson, John (Paisley)


Dormand, J. D.
Lewis, Ron (Carlisle)
Roderick, Caerwyn E.(Br'c'n&amp;R'dnor)


Douglas, Dick (Stirlingshire, E.)
Lomas, Kenneth
Roper, John


Douglas-Mann, Bruce
Loughlin, Charles
Rose, Paul B.


Duffy, A. E. P.
Lyon, Alexander W. (York)
Ross, Rt. Hn. William (Kilmarnock)


Eadie, Alex
Lyons, Edward (Bradford, E.)
Rowlands, Ted


Edelman, Maurice
Mabon, Dr. J. Dickson
Sandelson, Neville


Edwards, Robert (Bilston)
McBride, Neil
Sheldon, Robert (Ashton-under-Lyne)


Edwards, William (Merioneth)
McCartney, Hugh
Shore, Rt. Hn. Peter (Stepney)


Ellis, Tom
McGuire, Michael
Short,Rt.Hn.Edward(N'c'tle-u-Tyne)


English, Michael
Mackenzie, Gregor
Silkin, Rt. Hn. John (Deptford)


Evans, Fred
Mackie, John
Silkin, Hn. S. C. (Dulwich)


Ewing, Harry
Mackintosh, John P.
Sillars, James


Faulds, Andrew
Maclennan, Robert
Silverman, Julius


Fell, Anthony
McMaster, Stanley
Skinner, Dennis


Fisher,Mrs. Doris(B'ham,Ladywood)
McMillan, Tom (Glasgow, C.)
Small, William


Fitch, Alan (Wigan)
McNamara, J. Kevin
Smith, John (Lanarkshire, N.)


Fletcher, Raymond (Ilkeston)
Maginnis, John E.
Spearing, Nigel


Fletcher, Ted (Darlington)
Mahon, Simon (Bootle)
Spriggs, Leslie


Foley, Maurice
Mallalieu, J. P. W. (Hudderslleld, E.)
Stallard, A. W.


Foot, Michael
Marks, Kenneth
Stoddart, David (Swindon)


Ford, Ben
Marsden, F.
Stonehouse, Rt. Hn. John


Forrester, John
Marshall, Dr. Edmund
Strang, Gavin


Fraser, John (Norwood)
Marten, Neil
Strauss, Rt. Hn. G. R.


Freeson, Reginald
Mason, Rt. Hn. Roy
Summerskill, Hn. Dr. Shirley


Gilbert, Dr. John
Mayhew, Christopher
Swain, Thomas


Ginsburg, David (Dewsbury)
Meacher, Michael
Thomas, Jeffrey (Abertillery)


Golding, John
Mellish, Rt. Hn. Robert
Tinn, James


Gourlay, Harry




Grant, John D. (Islington, E.)
Mendelson, John
Tomney, Frank


Griffiths, Eddie (Brlghtside)
Mikardo, Ian
Torney, Tom


Griffiths, Will (Exchange)
Millan, Bruce
Turton, Rt. Hn. Sir Robin


Hamilton, James (Bothwell)
Miller, Dr. M. S.
Urwin, T. W.


Hamilton, William (Fife, W.)
Mitchell, R. C. (S'hampton, Itchen)
Varley, Eric G.


Hamling, William
Moate, Roger
Wainwright, Edwin


Hardy, Peter
Molloy, William
Walden, Brian (B'm'ham. All Saints)


Harper, Joseph
Molyneaux, James
Walker, Harold (Doncaster)


Healey, Rt. Hn. Denis
Morgan, Elystan (Cardiganshire)
Walker-Smith, Rt. Hn. Sir Derek


Heffer, Eric S.
Morris, Alfred (Wythenshawe)
Wallace, George


Hilton, W. S.
Morris, Charles R. (Openshaw)
Watkins, David


Horam, John
Morris, Rt. Hn. John (Aberavon)
Weitzman, David


Houghton, Rt. Hn. Douglas
Moyle, Roland
Wellbeloved, James


Howell, Denis (Small Heath)
Mulley, Rt. Hn. Frederick
Wells, William (Walsall, N.)


Huckfield, Leslie
Murray, Ronald King
White, James (Glasgow, Pollok)


Hughes, Rt. Hn. Cledwyn (Anglesey)
Oakes, Gordon
Whitehead, Phillip


Hughes, Mark (Durham)
Ogden, Eric
Whitlock, William


Hughes, Robert (Aberdeen, N.)
O'Halloran, Michael
Willey, Rt. Hn. Frederick


Hughes, Roy (Newport)
O'Malley, Brian
Williams, Alan (Swansea, W.)


Hunter, Adam
Oram, Bert
Williams, Mrs. Shirley (Hitchin)


Hutchison, Michael Clark
Orme, Stanley
Williams, W. T. (Warrington)


Irvine,Rt.Hn.SirArthur(Edge Hill)
Oswald, Thomas
Wilson, Alexander (Hamilton)


Janner, Greville
Owen, Dr. David (Plymouth, Sutton)
Wilson, William (Coventry, S.)


Jay, Rt. Hn. Douglas
Paget, R. T.
Woof, Robert


Jeger, Mrs. Lena
Palmer, Arthur



Jenkins, Hugh (Putney)
Panned, Rt. Hn. Charles
TELLERS FOR THE NOES:


John, Brynmor
Parker, John (Dagenham)
Mr. Walter Harrison and


Johnson, James (K'ston-on-Hull, w.)
Parry, Robert (Liverpool, Exchange)
Mr. James A. Dunn.

Question accordingly agreed to.

Clause 4 ordered to stand part of the Bill.

Schedule 3

REPEALS

Mr. John Mendelson: I beg to move Amendment No. 457, in page 24, leave out lines 4 to 17.

The Temporary Chairman: I hope that it will be convenient to take at the same time Amendments No. 458, in page 24, leave out lines 24 and 25, and No. 459, in page 24, leave out lines 41 to 48.

Mr. Mendelson: This group of Amendments is broadly concerned with the powers of the publicly-owned coal and steel industries. The Government in the Schedule seek to repeal some of the arrangements made in various nationalisation Acts. We are opposed to any repeal of these provisions and seek to retain them.
I intend to take this opportunity to have a much wider discussion about the future of the steel industry. It will be generally agreed that this debate takes place against the background of steel-producing areas in which people are gravely concerned about certain developments which are now taking place, particularly in view of announced and actual redundancies. They are also concerned about the future operations of the publicly-owned steel and coal industries if we enter the Common Market. It would make no sense to discuss any Amendment of this kind without giving proper attention to the wider background. Therefore, we shall expect to have an answer from the Government on the broad policy questions.
This is the first opportunity—and, indeed, it will be the only opportunity under the guillotine procedure—for the Committee to have a discussion—I do not say a "proper"discussion—on this important subject. We must first consider the position in which the EEC countries find themselves. A number of guidelines have been issued by the Commission about the steel industry, and they are closely linked to its views about competition. There are at the same time a number of policy decisions and adjudications made by the Commission on regional economic aid. We must remember that one of the characteristics of a discussion of the future of coal and steel is that a good many of the plants are

situated in intermediate or development areas. Therefore, there is a link between the two subjects.
Secondly, I feel that little is known in this country about the various views expressed by the Commission on the future of the steel industry and also on some aspects of regional policies. One characteristic which the coal and steel industries have in common is that technologically they are both developing industries in which the level of achievement and development is already very high and is growing daily. We are dealing not with backward industries but with industries which have a considerable future in terms of technological development. We also know that technological development often leads to job redundancies and that the employment problem is closely linked to industries which are not declining in the sense that they are becoming technical backwaters.
In recent years the British Steel Corporation has agreed with the trade unions and with various MPs a policy of what one may call parallel development. It has always been understood that the people who work in the steel industry are in favour of technological development. At all levels representatives of trade unions and staff have emerged hand in hand with the BSC in support of this policy, but there has always been an equal acceptance by the corporation of the proposition that such development must absorb the people who work in the industry and wish to continue to do so. There has been no acceptance, either by the trade union movement or by hon. Members on this side of the Committee, of a policy of widespread redundancies which is not followed at the same time by the creation of new jobs in the industry.
The first question I want to put to the Government is whether that is the policy they wish to adhere to, because at the present time there are many people in the steel-producing areas gravely concerned that this is not so. Some two to two and a half years ago, whenever members of the unions concerned or the Steel Committee of the Trades Union Congress, or groups of Members of Parliament met Lord Melchett and members of his board we would always receive concrete assurances that this was the policy which was going to be followed, and that


the BSC board was not going to be harried by pressures from outside or from anywhere else, including the Government, into changing this policy.
Many of us are now profoundly convinced that the Government have put pressure on the British Steel Corporation, and that the scale and the tempo of the redundancies have been greatly increased against the original intention of the board of the British Steel Corporation. Certainly the policy, if it is to be pursued, will meet the firmest possible opposition from the trades unions in the industry and from Members of Parliament representing the steel-producing areas. The Government must be well aware of this. They will have seen the reaction to the announcement about redundancies in Scotland. They will have seen the expressions of concern in other parts of the country.

[MR. E. L. MALLALIEU in the Chair]

I turn now specifically to the future of the industry if we were to go into the Common Market, and how this policy of expansion and the creation of new jobs might fare in the Community. We would want the Government to reply in specific terms on what conversations they have had with the Coal and Steel Authority and other Governments. We have had no concrete information about that so far. We have had general denials from time to time when the Prime Minister answers Questions at 3.15 p.m. He cannot be questioned further then. He never turns up for any of these debates. This legislation is the Prime Minister's legislation if ever any Prime Minister was concerned with any legislation. Whenever these matters are discussed, he is never with us. This is the first opportunity we have to demand of the Government and the Ministers some concrete information. May I say at a personal level that it would not be any worse because it came from a more junior level. What we are after is the information, and we do not mind who pronounces it at the Dispatch Box.

Turning to the position of the Community between the regional policy and the actual policy concerning the future of publicly-owned industry, I would like to pray in aid one or two illustrations which prove that that link is important.

I want to quote first very briefly from the General Report of the Commission for 1967. Paragraph 63(a) deals with the Dutch coal industry:
Arrangements to promote economic development in the north of the Netherlands, southern Limburg and other Dutch development areas. These are designed to supplement action already taken to help development centres in the country's 'problem areas', to contribute to regional development and to reduce the employment difficulties arising from the conversion of the coalmining areas in southern Limburg.
Here one sees the link between regional policy and the future of the coal and steel policy.

Although we have a technically advanced coal industry, there are areas where the problem of conversion from a coal-producing area to an area which has new and different industries is extremely relevant to the position of some areas in the United Kingdom. Therefore it is of great interest to see that over a number of years the Commission has occupied itself in considerable detail with approving or not approving some of the policies in such situations that any individual country wished to pursue.

9.0 p.m.

Moreover, a more recent case concerning the disagreement between the Commission and the Kingdom of Belgium was reported in considerable detail in the Financial Times of 27th April under the heading
Commission rules against Belgian regional aids",
and on the same day in The Times under the headline
Belgium's regional aid programme unacceptable under the EEC rules".
What is even more interesting and more strictly relevant to my purpose is the details of this adjudication by the Commission.

Here I wish to quote from Journal officiel des Communautés européenes of 4th May, 1972. What I find interesting is the great amount of detail into which the Commission goes in its adjudication. In the reports that we had in the British Press there was mention of only two cardinal decisions. The Commission told what is supposed to be the sovereign State of Belgium that it would not be allowed to give certain economic aid to as many as 41 of the districts into which


Belgium is divided, excluding Brussels and Antwerp. The Belgian Government, approved by Parliament, wanted to give economic aid to 41 districts. The Commission not only told them that they could not do that and that the number would have to be reduced to 27 or 28; it went into amazing detail, mentioning all the localities to which its decision applied.

To give just a taste of the decision to the Committee so that hon. Members may be aware of how detailed the control is, I quote the decision concerning the areas in which a certaintype of aid would be permitted. Not only does the Commission talk about provinces, sub-provinces and areas; it divides them into arrondissements, which are smallish quarters of any given region. The decision reads:
"…dans la province de Hainaut les arrondissements ďAth, Charleroi, Mons, Mouscon, Soignies et Thuin…".
I do not blame any member of the Committee who has not heard of these places before. I have heard of only 50 per cent, of them. Hon. Members representing mining areas may have heard of more. There are another 40 different names, and, when we get on to zones where only partial economic aid will be allowed and not what the sovereign Parliament of Belgium had already decided, we find that this partial aid can be allowed only
"…en prolongement de ľarrondissement de Turnhout et la province de Limburg, la zone s'étendant sur les communes de Aarschot, Averbode, Begijkendijk, Betekom, Booischot ….
That is part of a sub-district.

That illustrates the fantastic detail into which the Commission went when making its hostile decision against the wishes of the Belgian Government and Parliament.

Mr. Nicholas Ridley: I am wondering how the hon. Member for Penistone (Mr. John Mendelson) will use his considerable parliamentary skill to relate all this to the proposition that the Domestic Coal Consumers Council and the Industrial Coal Consumers Council should be allowed to continue. I understand that that is the purpose of his Amendment.

Mr. Mendelson: I can only say to the hon. Gentleman that he was no use as a Minister and it is quite evident that he is no use as a back bencher. I said clearly

that this is the first chance that we have had to ask the Government for some definite answers before we part with the Bill. I should have thought that the hon. Member who has always professed an interest in the steel industry would have co-operated in this whatever views he may hold, instead of asking a silly, sabotaging question like that.
What I wish to establish is the amazing detail to which the Commission went in countermanding certain economic decisions that the so-called "sovereign" Parliament and Government of Belgium had taken. I take this point further by going on to the actual views of the Commission on the future of the steel industry. Here, the questions of expansion and of the future size of the industry are the crux of the matter.
I have before me another copy of the official Journal of the Community. The date is 30th January, 1970. The title is "Grand Outline of a Policy concerning Production in Steel Industry". I assume that both the Chancellor of the Duchy and the Under-Secretary know these documents backwards and forwards, that they are their daily bread, and that they have studied them many times and are familiar with the case that I am about to make.
This document, which purports to deal mainly with competition, discusses the future of the steel industry in the Community. In paragraph 15 it forecasts that in 1975 the total output of the industry of the Community will be 140 million tons per annum. It then refers back to an earlier paragraph which expressed the general view that no group, no steel company forming a group, should be responsible for the production of more than 12 or 13 per cent. of the total volume of steel produced in the Community. It says that, if 140 million tons is the expected output in 1975, any group producing between 17 million and 18 million tons of steel per annum would be reaching this upper limit.
We have been trying to elicit from the Government for many months a denial or a confirmation of the articles which appeared in British newspapers by people who have spent many years studying the Community's policy, which said that the Government have been told and the British Steel Corporation has been told that an extension towards the level of 40 million or 41 million tons output by 1980


or 35 million to 36 million tons by 1975 will not be acceptable to the Community authorities. We have never had an answer to that question.

Mr. Rippon: With respect, it has always been made clear to the hon. Gentleman that the Community has put no limit on the expansion of British steel production.

Mr. Mendelson: It has never been made clear. Nor has it been made clear in that intervention. What is involved is something which does not yet have the force of law. These are guidelines. I am asking for something different. I want to know whether the Government can tell us whether when looking at the proposals submitted by Lord Melchett and the BSC Board, which were definite and which reached the Government in March, 1971, proposing, with details, an expansion over 10 years through an output level of 35 million tons in 1975 and 41 million in 1980, they have been guided by the limits suggested here by the Commission. If there is to be any question of freedom of expansion for the British steel industry, clearly there is no possibility of achieving such an expansion if anyone is to adhere to this upper limit of between 17 million and 18 million tons per annum.
It is in that light that I turn to the redundancies. That is why it is so important to discuss these matters against the current background. What we are seeing now is a number of developments which may well fit into a pattern of policy that would be greatly disturbing to the British steel industry as a whole and, in particular, to the more northern sections of the industry and to those regions that will be in grave economic danger anyway.
On this particular concern, I want to pray in aid a short article in the American journal Fortune. We know that Fortune is a very reputable journal that has excellent contacts in the European Community and in Britain. The article appeared in May of this year at the time when the Iron and Steel Bill was in Standing Committee. The article said:
The urgency of international joint ventures is perhaps most striking in the case of beleaguered British Steel Corporation, which lost an estimated 250 million dollars in 1971. In desperate need of efficient capacity, the nationalised company has approached Hoogovens Limited in Holland and Usinor of France, and a German company, with joint-

venture proposals. British Steel has one or two projects in mind—an expansion of its Teesside plant on the northeast coast or a big plant on a new site on the Thames estuary (or possibly on the Continent) that could produce 15 million tons a year.
The choice of project, BSC says, will depend on the amount of foreign capital it can get (the Thames plant would cost more than 3 billion dollars, about double the Teesside expansion). So far, prospective partners have shown little interest in courting the loss-ridden company. But last month the Heath Government announced a huge refinancing that will allow BSC to write off 875 million dollars in debt, which should make the old girl a little more alluring.
Are there any such dangerous and dark plans to shift a part of the expansion policy of the British Steel Corporation into the Thames area or even on to the Continent in collaboration with firms there? The arguments about financing and capital can be very easily used. If the Government were to say "We do not want the responsibility of financing all the expansion of the BSC. We do not regard it as a great national asset that must be treated as a great national asset for the future. We are not concerned about where the development takes place or where the new jobs are going to", some of the major fears of the people in our development areas would be completely fulfilled.

Mr. J. T. Price: I am obliged to my hon. Friend for bringing those facts to the notice of the Committee. I happen to represent a northern area of Britain which is under threat. The Irlam district, for example, is the only remaining steel plant in Lancashire and services the biggest heavy engineering complex in England. That has been sentenced to death in the next two years. The Stanton iron works in Nottingham has received a similar sentence, and the great complex at Mother well in Scotland is under a similar threat of very heavy redundancies.
My hon. Friend has referred to the American commentary. I do not have at my disposal any means of checking the veracity of those comments but no doubt they are from a very reliable source. But this would explain the contraction of the British steel industry, which in its present manifestations is looking forward to not a ceiling of 40 million tons a year but one of 24 million tons, as I know from another activity in which I am involved


in the House of Commons. Will the Minister say whether or not the figure of 24 million tons has been accepted by the Government as a limit to British steel production over the next few years?

9.15 p.m.

Mr. Mendelson: I move to my last two points. One concerns a recent report published by the Yorkshire and Humberside Economic Planning Council. Certain Yorkshire MPs including myself, had a meeting with the council and with its chairman recently. I took strong exception to one paragraph in its report. The council says the report was compiled by a body which did the research, and, although the report involved the backing of the council, it was suggested that it did not have the same authority as a report published exclusively by the council. I do not know whether I accept that explanation, but I wish to put it on record in order to be fair to the man who made the statement to us.
The paragraph which disturbs me, and which should disturb all Sheffield MPs and hon. Members representing South Yorkshire constituencies, said that there would be some development on the Continent of collaboration between British and Continental steel firms and that this would first lead to large-scale storage of steel and subsequently to further developments of joint production on the Continent. It is backed by the chairman of the Yorkshire and Humberside Economic Planning Council, a man who is involved in steel production in no small way, and someone who is supposed to be devoting most of his time to attracting jobs into Yorkshire and Humberside. I would not think he should support a report of that nature. This is not quite such an innocent paragraph, because these people probably know what is intended by some Ministers should Britain join the Common Market.
My last point concerns the conclusions of the Commission about the guidelines on the future of competition in the steel industry in the Community. In one paragraph the document says that the Commission would regard it as very serious if very large groups were to develop in the Community among steel producers, very large firms or groups of firms which produced more than 12 or 13 per cent. of total output.
We do not want a formal answer from the Government whether there have been

any such official discussions or not. We want a full account of all the talks that have taken place and all the official contacts that have occurred, because this is linked to a very important point on which, once again, we have not had an explanation from the Government in recent months. When the Minister for Industry announced the Government's decision that the British steel industry should develop output only to 28 million tons in the next 10 years, he was forced to admit under questioning that the corporation wanted a higher figure. The Minister was questioned time and again on what level steel imports should reach in the middle and later 1970s. Figures as large as 8 million tons were floated but we have had no word from the Government on that question. It would have to be a figure which would fit in with the limited growth figures put forward by the Government. If the capacity of the British steel industry is limited to 28 million tons and if there is an upturn in the economy, we shall need to import at least 8 million tons of foreign steel.
Our colleagues from the coalmining constituencies have reminded us that there is far too much imported coal at present. It is running at a level which cannot be economically justified. The Government are avoiding taking the measures they should take at home to encourage output and instead are importing coal. Are they now preparing an even more dangerous policy? Are they planning to import 7 million to 8 million tons of foreign steel, at the same time severely limiting development in the British industry, endangering jobs and failing to provide for the development of new jobs as promised by the BSC when it submitted its original plan and secured the agreement of the trade union movement to that plan?
Those are serious questions asked in the steel and coal areas up and down the country. The Government are duty bound to give serious answers tonight.

Mr. Ridley: Listening to the diatribe of the hon. Member for Penistone (Mr. John Mendelson) I was tempted to ask myself why Lord Melchett is so strongly in favour of joining the Community and why what he sees as the best interests of the steel industry are so different from those which the hon. Gentleman sees.
I had come tonight hoping to talk about the future of the coal and steel consumer councils, and I shall say something about that later. I cannot resist straying into the territory so trampled upon by the hon. Gentleman and saying a few words about the size, shape and future of the British Steel Corporation.
First, the hon. Gentleman said that the steel industry was a highly technological industry and that its future was assured provided only that we allow endless expansion to take place and endless investment.

Mr. John Mendelson: I did not say "endless".

Mr. Ridley: I withdraw that and substitute "investment on a large scale".
I must tell the hon. Gentleman, who spoke genuinely in the interests of his constituents who are steel workers, as will other hon. Members, that if we made massive investments in steel and had a technologically superb steel industry there would be not more employment but considerably less. Our competitors in America are already producing steel with perhaps one-third to one-quarter of the amount of labour we use and there is now, I think, a steelworks in Japan producing high-quality steel with one-seventh the number of workers that we employ. Therefore we realise that there are no enjoyable and easy alternatives.
Either we go on with old plant and over manned equipment in which case we have crippling losses, uncompetitive ness, and a dwindling market, or we pump money into the steel industry to make it modern and highly efficient in which case we have dwindling employment. The hon. Gentleman is living in a pink cloud, thinking that somehow by investing we can produce not only more steel but more jobs. I advise him to talk to someone who has studied the steel industries of the world, to acquaint himself with the facts of steel economics in the coming decade, and he will find that he is living in a fool's paradise.
I hope the corporation will be able to expand, but I am sure the whole Committee will agree that its expansion will entirely depend upon its ability to sell its products, whether in the home market or by exporting them. No one would

wish to have ingots of steel piling up unsold in the stockyards of our mills. We all know that that is what leads to closures, redudancies and unhappiness in the steel-working areas. Therefore, it is clear that the estimates of capacity in the future must be based upon the estimates of what can be sold at the cost of production.
I believe the Government would be right not to encourage the corporation to build plants and capacity which would produce more steel than could be sold. Neither I nor the hon. Gentleman has done the sums. We have not done the market research. We do not know what that figure is. I respectfully submit to the hon. Gentleman that it would be wise to make sure that the steel industry which exists in 20 years' time is of a size which will enable it to sell its products competitively and profitably in the markets of the world. This is why Lord Melchett is in favour of joining the Common Market, because he sees a market where he can sell more steel. I do not think that the fears of the hon. Gentleman about competition in Europe were justified, because if the professional people believe that it is the best thing for their marketing I would have thought it was wise to allow the leaders of the steel industry to be accepted as being right.
I have one other point before coming to the Consumer Council. The hon. Gentleman said he had never been told by the Government whether it was possible for the British Steel Corporation to expand and he implied that the reason why the Government were perhaps holding back a little on the grandest plans for the corporation was that they had been told to do so by Brussels because Brussels did not want any very large steel companies dominating the Market. From my experience I would like to rebut that absolutely. I would also like to rebut what the hon. Member said, that no member of the Government has ever given him a straight answer on this point. I would draw his attention to the OFFICIAL REPORT of 16th December last year when I said:
My hon. Friend the Member for Bedford asked a similar question: whether the European Commission would control the expansion of the corporation so that it did not reach a size to threaten true competition within the Common Market. I do not think my hon.


Friend need worry about this. The power that the Commission has taken is to prevent mergers which would lead to units so big as to dominate the steel market. But normal expansion through investment and growth is not a matter which it would consider checking and I do not believe that there would be any question of the BSC not being able to expand as it was required or wished to do."—[OFFICIAL REPORT, 16th December, 1971; Vol. 828, c. 966–7.]
That is as clear a statement of Government policy as the hon. Gentleman could ask for. Even though it may not be I who now speak from that Box, when I made that statement I spoke from that Box.

Mr. Michael Foot: Could the hon. Gentleman also tell us from his experience what he believes to be the results of the latest investigation of the British steel industry by the High Authority, embarked on a month or two ago? Can he tell us what stage that has reached and when it will be presented to the House?

Mr. Ridley: As the hon. Gentleman knows I embarked upon the back benches a month or two ago, so that I cannot answer that question. He must ask my right hon. Friend. I merely wished to correct the statement that authoritative noises had not been made on this most important point, and I think that I have done so. The hon. Member for Penistone suggested that the temptation would be for the steel plant to be concentrated in the South and he spoke of a plant on the Thames.
I ask the hon. Member to think about this. The geographical advantages of the British Steel Corporation in an enlarged Community where competition is free will be greatest where it is furthest from its competitors. The markets of the North of England, Scotland, Wales and Northern Ireland will be far more easily held by the BSC than will be the markets of the South of England where it is cheap to bring in steel from the Continent. I would have expected that the BSC would be planning to hold the northern part of the market with minimum inroads from competition. Competition will develop closer to the Channel coast from Belgium, France and Holland. Competition there will be and I for one welcome that.
That brings me to the Amendment, if I may make so bold as to talk about it. One of the Amendments suggests that

the power of the Iron and Steel Consumers' Council to suggest that prices be held down should be abolished—indeed, that the Iron and Steel Consumers' Council should be abolished and that the Secretary of State should be unable to make directives.
I am surprised to find the hon. Member for Ebbw Vale (Mr. Michael Foot) putting his name to the Amendment. I remember the hon. Gentleman time and time again getting up in the House and condemning the Government for holding down steel prices. On Monday we debated rising food prices and were censured; on Tuesday we debated some other rise in prices and we were censured; and on Wednesday of every week the hon. Gentleman gets up and censures the Government for not allowing steel prices to rise. That is his logical approach to these matters. But here his wishes have been put into effect. The Iron and Steel Consumers' Council is being abolished and no more Government interference will be possible in steel prices after 1st January. I look forward to the hon. Gentleman joining us in the Lobby.

9.30 p.m.

Mr. Michael Foot: I do not know whether the hon. Gentleman is deliberately misrepresenting me or doing so by accident. The fact of the matter is, as the hon. Gentleman will well recall from the many debates in which we have participated, that I have always explained I was not claiming that no Government should have any right to interfere with the prices of the steel industry and other industries. I always protected our view on that matter. I was complaining about the Government's discriminatory intervention in interfering with steel prices, thus preventing the steel industry from having the same kind of latitude which is allowed to many private industries.

Mr. Ridley: With the liberty of the back benches, I agree with the hon. Gentleman. That is why I am delighted that the Amendment will not be carried tonight.
That brings me to the last point I want to make. In the Bill the central functions of consumer councils as we know them for coal and steel are being abolished. By "central functions" I mean their power to comment on the


general level of prices and to make representations.
I support entirely the ombudsman or consumer protection of consumer councils. Particularly I commend the area regional councils of the gas and electricity industries, which take up the complaints of consumers and protect the individual against a monolithic supply organisation. However, the only reason why we have to have central consumer councils to comment on prices is that all these nationalised industries are domestic monopolies: gas, electricity, coal and, to all intents and purposes, steel.
Having created these monopolies, against which I fought when I was sitting on the other side of the House and would continue to fight if they were to be extended, it was necessary to set up consumer councils. The idea was that this would lull the individual into thinking that his interests were being protected. But let every right hon. and hon. Member be honest with himself. Do we believe that the central consumer councils of nationalised industries have had any impact upon prices, efficiency, productivity or any of the factors which make for things being cheaper as opposed to move expensive? Of course not. They have not made one jot or tittle of difference. What makes a difference to prices is competition, and at last we will have our great British Steel Corporation exposed to full and fair competition with the Continent.

Mr. J. T. Price: How does the hon. Member know?

Mr. Ridley: I know because I have read the European Steel and Coal Treaty. I have seen the scrupulous fairness with which it is administered from Luxembourg. Instead of having Mr. Jack Frye, to whom I pay great tribute, and his council commenting in vain against the mammoth of the Government and the Steel Corporation joining together to rig prices, we will have German, French and Dutch steel edging across the Channel at competitive prices. This will be of far more benefit to the consumer of steel than any consumer council.
If hon. Gentlemen opposite claim to represent the interests of either steel workers—

Mr. J. T. Price: What about the thousands out of work?

Mr. Ridley: —or coal miners, they would be well advised not only to withdraw the Amendment but to support Lord Melchett, Mr. Derek Ezra and Lord Robens, the leaders of these great industries, who are foremost in their advocacy of joining the Common Market.

Mr. Alex Eadie: I do not wish to be unkind to the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), because I know that when people suffer disappointments it is easy to rub their noses on the ground, so to speak. If, however, the hon. Member was trying to persuade anybody to support the Government on the proposition which they have had before the House and the Committee for many weeks, I should think he was a great embarrassment. It may be that he is not a great embarrassment in the sense that the Government are grateful to get allies from their own back benches; I am talking about getting support from hon. Members on this side of the Committee. I address myself to the Chancellor of the Duchy of Lancaster who has been giggling throughout the debate. There is nothing funny about it.
The hon. Member for Cirencester and Tewkesbury, who dealt with the consumer council for coal, paid scant regard to the fact that we should have some democratic content within the structure of nationalised industries or even in private industries where people, however successful or varyingly successful, have tried to influence the progress of an industry or the price structure within it.
The Committee should realise that we shall not have either coal consumer councils or steel consumer councils within the Common Market. This is no doubt why the hon. Gentleman is probably so happy. If we go into the Common Market we shall have merchants' associations. There will not be any consumer councils of the kind we have known or been associated with in this country.
The Under-Secretary must tell us, when he replies, whether he is happy that the democratic content should be taken out of what was traditionally associated with the main industries in this country by the mere fact of deciding to enter the


Common Market. Is the philosophy now that the consumers can go to hell and in substitution for consumer councils we shall have merchants' associations dictating prices and policies? The hon. Gentleman should be honest and tell the House whether he is happy about that situation. If so, the people of this country are entitled to know. The hon. Gentleman has said that he likes the icy blast of competition. Are the Government more concerned about the philosophy of competition than about people or consumers?
I congratulate my hon. Friend the Member for Penistone (Mr. John Mendelson) on the way he moved the Amendment. I was very much impressed by what he said about the coal industries of Belgium and Holland. I think I have recited this argument before. With what kind of organisation are we to be associated under the Treaty of Paris? A couple of years ago there was a European conference, at which there was British representation, to discuss the coal industry. I wonder whether Mr. Ezra was very enthusiastic about it. For example, it was spelt out at that conference that there had been a serious miscalculation about the part that coal should play in the energy requirements of certain countries. Belgium and Holland admitted that they had run down their coal industries substantially and that it was now too late to do anything about it. They had planned to contract their coal industries to such an extent that there was nothing they could do about it. The coal industry was already in contraction, yet the bureaucratic content of this body with which we are associating could not take a decision to halt the procedure of contraction in that industry.
It is no secret—we read it in the papers every day—that great errors and miscalculations were made in the Treaty of Paris. We discover, for example, that in relation to natural gas France is in a serious dilemma, having made a 20 per cent. over calculation. Even in this country we have discovered—and we are grateful to the hon. Member for Cirencester and Tewkesbury because it was he who told the House this—that there is only about a 20 years' supply of natural gas. I know that he incurred the wrath of many of his hon. Friends when on 11th March this year the hon. Gentleman said

from the Dispatch Box that the estimate he had for natural gas was about 20 years. I have given the date and the quotation, and the hon. Gentleman cannot deny that.

Mr. Ridley: I got the rap; I did not deny the figure.

Mr. Eadie: I will pronounce it the English way if it pleases the hon. Gentleman any better. I happen to be a Scotsman and I get the lingo a bit wrong occasionally. The hon. Gentleman was in the unfortunate position of looking towards us and we were in the unfortunate position of looking at the faces of his hon. Friends behind him while he was making that pronouncement.
I was trying to explain the Treaty of Paris with which we are associated, the gross miscalculations in relation to energy by Holland and Belgium and the dilemma that France is in at the present time. I think I was entitled to bring that to the attention of the Committee because in the course of the hon. Gentleman's speech he tried to infer that, if we became a member of that body, we would become much more efficient and there would be the draught of competition, yet all the evidence indicates that we are joining what is in many respects a very bureaucratic and inefficient body.
I asked a question about the coal consumers' council and the Under-Secretary on the Front Bench nodded his head to indicate that he would like to reply. I should like to pose a specific question in relation to the restructuring of the mining industry. The hon. Gentleman is pretty well apprised of the arguments in relation to this: that our coal industry is burdened with debts and financial burdens that are lying, as I have often said, on the backs of the miners, yet neither the industry nor the miners have any responsibility for the financial burdens placed on them. I have explained before in the House that if we consider some new pits that were sunk on the first day of nationalisation, they were the result of plans not of the National Coal Board but of the private coal owners, who were paid compensation; they got what was termed "unforeseen profits". Many of those pits are now closed after millions of pounds were spent on them. They were handed over by private enterprise


to the National Coal Board and compensation was paid on the basis of unforeseen profits, but not a penny of profit has been made since the day they commenced. That is the kind of debt that is on the backs of the miners and the kind of burden that is placed on the finances of the National Coal Board.
I see the hon. Gentleman tut-tutting but I would remind him of Rothes Colliery and how he talked about it once in Committee as being the handmaiden of the National Coal Board. He was unfortunate when he said that because I happened to live in the area and I know that it was part of the old Fife Coal Company, a private enterprise. It is fortunate that I lived near enough to correct him at that stage.
A Question was asked yesterday—No. 70, which can be found in column 230 of HANSARD—by my hon. Friend the Member for Wigan (Mr. Fitch). It concerned the capital reconstruction of the National Coal Board's finances. My hon. Friend was told by the Minister for Industry that he is considering the proposals in relation to capital reconstruction.

[Sir MYER GALPERN in the Chair]

9.45 p.m.

I have a direct question to put to the Minister. Since the Department is considering the question of capital reconstruction, how will this be affected by our entry in accordance with the Treaty of Paris? Will entry make any difference? Will the Government be able to carry out a capital reconstruction of the coal industry? Or does it mean that when we enter the Coal and Steel Community restrictions and reservations will be placed upon capital reconstruction? This is a very important point. The miners want to know the answer, and they want a direct and specific answer.

Again, what about coal imports? We are in a ridiculous situation. Last Friday I put a question about imports to the Chancellor of the Exchequer when he made his terrible announcement, which I described as a defeat for the Government and the British people. Next month in Scotland hundreds more men will be out of a job in the coal industry. Yet the Government are part and parcel of a policy of importing 3 million tons of

coal. The ridiculous thing about it is that the imported coal is dearer than the coal which our own miners are producing. What kind of a Government pursue a policy of importing 3 million tons of coal which must be a further burden on our balance of payments?

We want to know whether, after entering the EEC, we in this Parliament will be able to influence the Government to understand that their policy of importing coal is a nonsense, particularly for a country facing a financial crisis. We know that when we enter the EEC coal will be able to come into this country from France, Belgium and Germany. Yet it is not even as simple as that because foreign coal comes in through Rotterdam. This was one of the problems we faced during the miners' strike. We did not know whether the coal coming in from Rotterdam was Australian, Polish or American. We are entitled to ask what sort of agreement the Government are entering into in relation to foreign coal.

The hon. Member for Cirencester and Tewkesbury talked about assurances given by Mr. Ezra. Mr. Ezra is a rather lonely man these days. Few people on the trade union side of the coal industry have much confidence in the predictions and optimisms of Mr. Ezra. If I were trying to quote authorities on the position of our coal industry after we enter the EEC, I would find it difficult to include his name among them.

The contraction of the steel industry has a direct bearing on the livelihood of our miners. Contraction of the steel industry means the need for less coking coal. There is no viable economic alternative for coking coal, and if the steel industry needs less of it that must place more jobs in the coal industry in jeopardy.

Mr hon. Friend the Member for Rutherglen (Mr. Gregor Mackenzie) unsuccessfully applied under the Standing Order No. 9 procedure for a debate on the tragic blow that has struck Scotland with the loss of 7,500 jobs—it may be a thousand or two more—in the steel industry. A contraction of such magnitude in the steel industry is important to the Scottish people. It may result in the multiplication by three of the number of jobs lost. The 21,000 people whose employment prospects have disappeared practically overnight will not be impressed by being told that this is the result of


competition and that the steel industry is being modernised and streamlined.

My hon. Friends who are associated with the mining industry could hardly be described as Luddites. Throughout our lives we have been associated with modernisation in the mining industry and we have wished it to come. We do not argue against technological improvement in the steel industry. When plant becomes obsolete we do not argue that it should be kept in being to provide jobs.

The people of Scotland are entitled to know what will happen to the Hunterston plant. We argue that the only solution is for the Government to believe in the fight for economic growth and to forget about the 28–36 million ton target. The Government must go for growth and greater production. There could be a green field complex in Hunterston and the area could be developed, thus helping to save many jobs which will be lost as a result of technological obsolescence. That is the answer that we see.

I hope that the Minister will try to answer the questions which I have raised. They are of great moment not only to the the people of Scotland but to the people of England and Wales who are associated with the coal and steel industries.

Mr. David Crouch: I do not think anyone would accuse the hon. Member for Midlothian (Mr. Eadie) of being a Luddite in relation to the coal industry or in relation to the steel industry if he meant what he said in his closing remarks. I do not think there are many, if any, Members of the Committee who are Luddites at heart. We sometimes have to listen to rather woolly arguments on industrial development and modernisation when hon. Gentlemen opposite—I am not referring to the hon. Member for Midlothian—try to envisage the changes that have taken place and are taking place in the coal industry.
We owe a great debt of gratitude to the mining industry, the National Union of Mineworkers, the National Coal Board, the House of Commons and all those who in the last 20 years have taken part in the modernisation of, and the massive investment in, the mining industry, and in the reduction of the work force in an industry that used to employ nearly a million men.

We have seen the changes occur, industrial and social, resulting in a revolution in industrial patterns. It has been done in this country brilliantly, with co-operation. It has also been done in Europe. It has been done under the management of the European Coal and Steel Community. I would not argue that Europe has done it better than we have. This change in industrial shape, from the 19th century to the latter end of the 20th century, has taken place.
When we look at the steel industry we see a change taking place subsequent to the changes which have taken place, and which are still occurring, in the coal industry. The challenge which has faced Parliament over the last two or three years, as we have looked at the steel industry seriously, is the magnitude of change that we must face with the steel industry in the next 30 years.
I do not have to refer to the US magazine Fortune to learn that there was once put forward by some industrial thinkers and engineering developers an idea of a great steel complex in the Thames Estuary. Such ideas have been put forward in this country for the past two or three years and seriously floated by engineers, economic planners, thinkers and developers. That is much closer to my heart: it is with insight of my constituency. I could see it 10 miles away as it developed. I would be concerned and horrified if that were to happen. I am not sure, if I were to look ahead 30 years, that I would be right to be horrified if that was the right place for such an industrial development to take place for the benefit of the country.
Sometimes in Parliament we hear not a philosophy of Luddite thinking so much as—when we try to consider the problem of change—the impossibility of accepting all that flows from change. We hear other things in debates such as this which do not encourage me. We get a feeling of absolute gloom that this country and our great coal and steel industries are not going to be in a position to take up the opportunity which we shall find when we enter into the larger Community and a larger market. Hon. Members opposite feel we are not going to be able to compete. Yet they come to this Committee and tell us that we shall suffer imports from the coal producers in France and Germany. Why did they say this?
The hon. Member for Midlothian tells us how he has co-operated in the modernisation of our pits. Why should he ask the Committee to assume that we must suffer under the competition? I cannot accept that. I have seen the modernisation of our pits. I have seen the hard work which miners put into their jobs. I respect that. They have been examples, in hard work and productivity, to the whole of industry. I accept that. I do not think there is one mining Member in Parliament who would accept that we have had an element of absenteeism that has been too high in some areas. Perhaps there are reasons for this. Nevertheless the facts are there.

Mr. Denis Skinner: This is where the absenteeism is!

Mr. Crouch: I give the hon. Member a chance to interrupt me because he likes to do so. I do not think he disagrees with much of what I am saying—because I have praised his industry during the last five minutes—becauseof what he has contributed to his industry outside Parliament.
I now return to the three Amendments—

Mr. Arthur Lewis: The hon. Member showed his appreciation of the miners when they had their wage increase.

Mr. Crouch: The hon. Gentleman may have forgotten that I made three speeches in this House and took the view—

It being Ten o'clock, The CHAIRMANleft the Chair to report Progress and ask leave to sit again.

Committee report Progress.

Orders of the Day — BUSINESS OF THE HOUSE

Ordered,

That the Harbours Development (Scotland) Bill may be proceeded with at this day's Sitting, though opposed, until any hour.—[Mr. Fortescue.]

Orders of the Day — EUROPEAN COMMUNITIES BILL

Again considered in Committee.

Question again proposed, That the Amendment be made.

Mr. Crouch: I shall not be diverted by interventions since I shall find myself out of order. I return immediately to the three Amendments.
The European Coal and Steel Community, which was established in 1951, has certainly not been a failure in the Six. Indeed, it has proved to be a great success. We are joining a successful part of the Community; namely, the ECSC. This is borne out by the figures. Coal production in the ECSC in 1970 was 170 million tons, but coal consumption in the Community was much more than that figure: it was over 200 million tons. There is already a significant gap between production and consumption. Therefore, need we be in such gloom at the prospect of reaching into a market which will mean our exporting coal to the enlarged Community? There is already an opportunity in the Six to take advantage of that higher consumption in terms of our coal supplies.
I am a firm believer in the British coal industry and have often spoken in Parliament about the retention of efficient coalfields and also about increasing our investment so as to make them still more efficient. I have always believed that there is a place for coal in our combined fuel economy in Britain and in the wider European market since coal is one of our major fuel factors. As we see changes in the oil situation in the next 10 or 20 years, I believe that coal will play, not a less important part but a significantly greater part in meeting future energy needs. The situation will not be greatly different, but I feel that the importance of coal will not be diminished. There is already a gap to be filled and this will result in demand for additional coal in the European countries with which we are about to join in partnership.
Since we have an opportunity to meet that demand by increasing the British production and by increasing our efficiency, this should be an incentive to our coal industry. Surely this is the sort of incentive and hope to which our miners should be looking forward. This is


certainly the sort of hope that they deserve.
As we go into the Common Market everybody in industry is concerned with the answer to the question "How will it affect me?" Every individual wants to know whether his industry will expand or decrease in size. My opinion is that the coal industry will have a great opportunity to increase in size and will be able to make greater exports in enlarged markets.
The situation in the steel industry is a little different. The British Steel Corporation faces the problem of joining the ECSC in the knowledge that our industry will be about 20 per cent. of the size of the combined steel production of the ECSC. We also know that we are going in with a much modernised British Steel Corporation, with still more modernisation to be achieved. We go in with a strong industry and a big opportunity. I do not see why we should feel gloomy about the prospects. As my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) commented, he believes that the pressures of competition on the British Steel Corporation will be beneficial. That is certainly my view. Lord Melchett, the chairman of this nationalised industry, has expressed his own confidence. I hope that the confidence expressed by the chairman, and the confidence that I and my colleagues are expressing tonight about the opportunity of the British Steel Corporation further to expand and to take the opportunity of selling in a wider market, will be passed on through the whole of the management structure of the steel industry down to those working in the steel mills.

Mr. Raymond Fletcher: The hon. Gentleman will realise that what many of us really fear is that management in steel, which is good management on the whole—Lord Melchett has done a reasonably good job—is already remote from the plants which are managed. When we join the European Coal and Steel Community it will be even more remote from the plants which are managed. Siting and planning considerations will be more concerned with Europe than with the social problems of the workers here. This real fear is exemplified by the fact that 1,500 jobs in

my constituency have recently been placed under sentence of death.

Mr. Crouch: I would accept that intervention as a valuable contribution to our general thinking about what will happen to the steel industry when we go into the Common Market. The hon. Gentleman referred essentially to management problems in the industry. If there is a management weakness it will have to be tackled not by us in the House of Commons but by the British Steel Corporation.
The hon. Gentleman mentioned something else which other hon. Members have already referred to and which no one in the House can ignore; that is, that we are talking not only about economic opportunity but also about opportunities for jobs and for continuing work in the industry. I respect this absolutely. It is the job of management to ensure that we become more efficient, bearing in mind our social obligations to those whom we employ today but who, because of increasing efficiency, may have to be made redundant, as some have already become redundant. These are the problems of management, and they are the problems which the management of the National Coal Board and the National Union of Mineworkers have managed to face up to and resolve—not perfectly, as I am the first to acknowledge, but nevertheless management problems have been tackled.
I do not think that by joining the Community we should think for one moment that the management of the British steel industry will be transferred to Luxembourg, Strasbourg or Brussels. That is a complete misunderstanding of the position of Member States in the Community. The only difference in position in which we shall find ourselves in the ECSC is that some modification to the position of the Minister, the Secretary of State in this country, has to be made. That is what the Amendment suggests should not be done. The modifications suggested in the three Amendments would allow the Secretary of State to retain powers which I personally think he should retain.
I was never happy about the possibility of interference from the Secretary of State in the proper management and running of the industry. Here I agree with


the hon. Member for Ebbw Vale (Mr. Michael Foot), who expressed concern about the intervention of the Secretary of State over steel prices. I understood the reason for that intervention, though I never liked it. I prefer to see the chairman of a nationalised industry given the freedom to manage his industry without interference. However, such interference has been modified and has been taken away in the Bill. That is why I am strongly opposed to the suggestion in the three Amendments that it should be returned.

Mr. Barry Jones: The hon. Member for Canterbury (Mr. Crouch) made a sincere, provocative, unconvincing and serpentine speech.
I do not think that anyone disputes that the steel industry is the very foundation of our national economic activity. I find it very disturbing that the British Steel Corporation appears to be making a run for Europe in order to secure its independence in price levels and to slip the lead of the DTI. Equally daunting is the sight of our Government placing constraints upon the growth potential of the country's basic industry to pay, in part at least, the price of entry into the Community.
Whatever the outcome of these stealthy activities, the fact seems to be that the British Steel Corporation in Wales undoubtedly is the largest and best employer of labour that one can imagine. As many as 33 per cent. of the working population in Wales are employed by the corporation.
There is no doubt in my mind that the economies of North and South Wales are bound inextricably to the fortunes of the steel industry, and I hope that hon. Members will take it from me that there is a very substantial steel industry in North Wales. It employs 16,000 people, 13,000 of whom work at the large steel works at Shotton in East Flintshire, though what might be described as a sword of Damocles hangs over the North Wales steel industry and there is a growing body of opinion which believes that the Government bartered away some of our steel greatness to pay the price of entry to the EEC.
I do not take any pleasure in re-reading my speeches, but I recollect that in our October debate on the Common Market I asked the Minister whether any plan

existed which postulated a rather high rate of redundancy in the steel industry in the decade ahead. I asked him to nail the lies and rumours concerning the development of the industry. Today, eight months later, we see a likely production ceiling of only 28 million tons, and we have seen already the callous plans for closing Irlam and rendering nearly 8,000 Scottish steel men unemployed. There is little wonder that the 7,000 men who work the 12 open-hearth furnaces in the Shotton steel works in my constituency have baffled feelings and heavy hearts.
It appears that we are to make a triumphant entry into Europe and then the finest steel men in Britain join the dole queues. Hon. Members should take every opportunity to say to the Government that it is not only the computers, the accountants and the slide-rule which should decide what happens in the British steel industry. We ought to have a great deal of concern for the social implications and the regional, sub-regional and even national complications if and when large numbers of men previously employed at open-hearth furnaces are left without jobs because of the findings of computers and slide-rule accountants in high-powered city offices. I hope therefore that the Government can give some telling assurances to the steel workers in Wales, particularly at Shotton.
10.15 p.m.
When I first mentioned my worries about the future of Shotton I found a great deal of support regionally. My hon. Friends from Merseyside came out with a ringing and stirring declaration of support for the need for further investment at Shotton. They particularly pinpointed the need for the building of a deep water dock on the Birkenhead side of the River Mersey. That would not only mean that Shotton would become much more commercial and profitable but would provide employment for many people in Birkenhead and Liverpool. I was also pleased to find that many hon. Members on the Government side declared their willingness to indicate in the right quarters their feeling, no matter what part of North Wales they represented, that Shotton should have substantial investment soon. Hon. Members opposite from Cheshire and that area also gave support.
No one would deny that there is a crisis point on Deeside and that if these open-hearth furnaces were replaced, disaster would hit not only Flintshire and Denbighshire but also parts of Cheshire and a great deal of Merseyside. Some have gone so far as to say that the whole

economic infrastructure from Caernarvonshire to Chester could be seriously undermined if the Government were foolish enough not to allow Shotton to have the £50 million investment programme which has been submitted to them.

The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): I welcome this debate because it allows the Government to ensure that those who work in the coal and steel industries understand that it is the Government's firm and definite view that our entry into the EEC will provide advantages and maximise opportunities for both industries. Let us therefore start on that understanding.
Our coal and steel industries are well placed to meet the challenge of entry. We shall be the largest coal producer in the Community and the BSC will become the Community's principal steel producer. We shall be able to play a leading rôle in the development of the European Coal and Steel Community. Surely that is what hon. Members opposite want. It is certainly what I believe all people in these industries would like—both workers and management. This is the first debate that we have been able to have on this matter. This question is the opportunity which will be provided for these industries by our entry.
The hon. Member for Penistone (Mr. John Mendelson) asked me a number of questions. He asked whether the tempo of redundancies in steel would increase under the pressure of Government. The answer is a categorical "No". It is absolutely untrue to suggest that a redundancy programme has been increased because of governmental pressure. In the same way, the hon. Gentleman asked whether there had been consultation about the size of the steel industry with the Higher Authority, with the EEC or with the European Coal and Steel Community. Let me again give him the sort of categorical answer for which his speech asked. There have been no exchanges of documents, written statements or correspondence between Her Majesty's Government and the European Coal and Steel Community or the member States concerning the future development of the United Kingdom's steel industry. In other words, the assurance that the hon. Gentleman wants—

Mr. Peter Hardy: Not discussed at all?

Mr. Emery: I am saying that nothing has been hidden. There is nothing that has been done under the counter, nothing that has not been disclosed. Therefore, the whole of the position about the future of the British steel industry has not been discussed with the European Coal and Steel Community.

Mr. Eric S. Heffer: That makes it even worse. Hon. Gentlemen on the Government benches are a bunch of idiots.

Mr. Hardy: The Minister is able to give a categorical assurance that there is reason for optimism. At the same time he says that that is justified because there have been no talks. Can he say that there have been no talks? If he does say that, does he believe that the Committee would believe an optimistic forecast?

Mr. Emery: Let us get the question clear. The Opposition have asked whether anything has been hidden, whether there is anything that has been done behind the scenes, or whether any controls which exist in the Community will limit the expansion of this industry. I am able to say to the Opposition that there have been no discussions on this matter. There has been no way in which limitation is possible. The British industry will be as free as it ever was to expand. It will be in the position as stated by my hon. Friend the Member for Cirencester and Tewkesbury (Mr.Ridley). The industry will rely upon what it is able to sell. Those are the assurances for which the Opposition have asked and it is important that they should be given.
The hon. Member for Penistone also raised a point about the Dutch coal industry. Negotiations are taking place at present about the re-adaptation treaties, which are the ways by which the industry and those working in it will be able to obtain benefits out of our subscription to the Community. In the regional areas, and, indeed, in any policies on both social matters and the movement of labour, and any redundancy questions, this is one of the ways in which we shall be able to benefit from our entry into the Community.
The hon. Member for Penistone also asked about the 13 per cent. rule. In a document published in the Community's


official Journal on 30th January, 1970, entitled "The Broad Outline of Competition Policy in the Structure of the Steel Industry", the Commission set out its views on competition within the concentrations of the ECSC steel industry. The Commission estimated that the number of ECSC enterprises providing 90 per cent. of the Community crude steel production should be fewer than about 10 and that there should be a change in the industry's structure towards a situation where the largest had 12 or 13 per cent. of the Community's steel production.
That is exactly the factor to which the hon. Gentleman referred. The Commission drew the attention of the European steel producers to that fact. This is an opinion of the High Authority but it is in no way binding.
The hon. Gentleman asked whether this put any limitation on the target set by the joint steering group. The answer to that, again, is "No". The Joint Steering Group, which comprised both the BSC and Government working together, did not consider that this had anything to do with the expansion that we were able to see for the British steel industry.

Mr. Eadie: rose—

Mr. Emery: I want to answer the hon. Gentleman's speech first and then I will answer any questions that are left.

Mr. Eadie: This is an important point.

Mr. Emery: If I give way I shall not be able to answer the hon. Gentleman's speech.

Mr. Eadie: This is an important point. It concerns the Government and the British Steel Corporation and the question of the joint steering committee. Will the Under-Secretary confess that the BSC and the joint steering committee had never seen the McKinsey Report, so how could they have known what the global output should be?

Mr. Emery: The McKinsey Report was not received until after the joint steering group had reported. The report was made available immediately to the BSC, so there is no question of anything being hidden. I thought that had been quite clearly stated to the House.
My hon. Friend the Member for Cirencester and Tewkesbury pointed out

one of the major factors which is not considered often enough in this House when regional arguments about the placement of steel works are being considered. What we manufacture we must sell. The sales of manufactured iron and steel products will be a major determining factor in the size of the industry. I pay tribute to my hon. Friend for the rôle he has always played in the protection of consumers' interest in connection with the consumers' council.

Mr. Arthur Lewis: What a load of rubbish.

Mr. Emery: I think that the hon. Member for Midlothian said that if we joined the EEC there would be consumers' councils. But the consumers' councils for the electricity and gas industries will remain exactly as they are. The domestic consumers' council for the coal industry will be retained and will still be able to be financed by the Government.
It was suggested by a number of hon. Members, including the hon. Member for Midlothian, that the whole concept of the Treaty of Paris was unacceptable. But the Labour Government made it absolutely clear that they accepted the Treaty of Paris without reservation, and that is what we are debating today. It is only through the Treaty of Paris that we have the European Coal and Steel Community. At the time, however, the Labour Government made not the slightest criticism of it. I am worried that the criticism today is being levelled by people who do not want us to join the Common Market. They are using the argument to ensure that we do not enter Europe in any guise whatever. That point needs to be brought out.
The hon. Member for Midlothian asked me about the capital reconstruction of the coal industry. I can give him a categorical answer that we shall be able to carry out the capital reconstruction that we wish, and there is no way in which the Treaty of Paris can really affect that.
The hon. Gentleman then argued the problem of the steel industry in Scotland, which I can understand. On 20th June the Corporation announced the prospect—and it was only the prospect—of the loss of 6,500 to 7,500 job opportunities in Scotland over the next five years as a result of the need to close down out-dated


open-hearth steelmaking plant. The Corporation believed it right in any discussions it was having in Scotland to set out the future of the Scottish industry. There is nothing new in the fact that open-hearth plant is out-dated. There is nothing new in the fact that the steel industry must modernise and rationalise to be able to compete in the rest of the world. One of the main arguments for nationalisation was that it would allow rationalisation to be brought about more simply and easily. The hon. Gentleman cannot complain when he sees it coming about.

Mr. Gregor Mackenzie: The hon. Gentleman has harangued us for long enough about the insensitive announcement by the Corporation last week. He must bear in mind that the Corporation came to us just a couple of days before we discovered we had the highest June unemployment figures for many years in Scotland. He must take those two things together before making further comments.

Mr. Emery: Of course the unemployment figures are of the greatest concern, but I hope that the fall in the United Kingdom unemployment level is of pleasure to both sides of the Committee.
The hon. Gentleman must realise that his party made the nationalised steel corporation an independently-managed body. It has a right in discussions to set out, without consultation with the Government, what it thinks is the likely position of the most redundant plant within any area. I am not trying to shrink from what was put fairly and openly to people in proper consultation.
It is important to remember the other side of the coin in Scotland. A record £265 million investment programme has been approved for 1972–73, some three times the programme which existed in 1968 and 1969. These are the facts which are often forgotten when we are considering the way in which rationalisation and modernisation will be brought to the Scottish industry. On the stocks is £60 million of new investment at Ravenscraig. As a result, Scottish steelmaking will increase in total. In addition, £26 million is earmarked for the deep-water terminal at Hunterston.
The hon. Member for Midlothian urged me to make an announcement tonight about a green field site at Hunterston.

He is only taunting me. He knows that that is impossible. He must bear in mind that a number of other Opposition hon. Members would like the green field site to be not at Hunterston put perhaps at Port Talbot, or perhaps in Flintshire. These are problems the Corporation is trying to solve. It is trying to work out what type of investment there shall be and how it shall be brought about in order to achieve the future production capacity of the industry as a whole.

Mr. Jay: rose—

Mr. Emery: I have given way a great deal, and I have only five minutes left.
Lord Melchett welcomes our entry into the Community. He looks forward to the dynamic effect that it will have on the industry's customers and on its own production. The private sector of the industry holds similar views.
Turning to the coal situation, we have seen a recovery since the coal strike, demonstrating the resilience of our coal industry. Productivity is now higher than a year ago and stocks are above the level of last year. There is no reason to expect that membership of the Community will in any way be detrimental to our industry. On the contrary, the opportunities for greater trade in coal in Europe within the competitive framework set by the Community should benefit the industry particularly.
In 1971 when Community coal was free to enter the United Kingdom less than a quarter of a million tons was imported. In the same year we exported nearly 2½ million tons to the Community. The Community is currently importing about 25 million tons of coal—

Mr. Heffer: Answer the debate instead of reading.

Mr. Emery: The hon. Gentleman has not been paying attention.

Mr. Heffer: I have listened to you for long enough.

Mr. Emery: There were direct questions put to me on the import and export of coal. The hon. Member may not have put them to me but others are interested in these matters. The Community is currently importing 25 million tons of coal, and there is a great opportunity for the NCB to win some of that market. We


shall also remain free to decide on our own policy towards any importation from third countries, a point raised by the hon. Member for Midlothian. That power will still remain with the Government.
The legislative changes required in the Bill are purely and simply to deal with the Consultative Council situation. As a member of the European Coal and Steel Community, the United Kingdom will be represented on the European Coal and Steel Community Consultative Committee by producers, workers, consumers and dealers, not just, as was suggested, by producers alone. The representation of steel consumer interests on the existing Consultative Committee includes stockholders, plant manufacturers, mechanical and electrical engineering, the motor car industry and general users. This Committee is consulted before important decisions are taken by the Commission, and our representatives will be able to ensure that proper account is taken of our interests, including those specifically of the consumer.
I come to the query of the hon. Member for Flint, East (Mr. Barry Jones) about Shotton. I cannot say anything further than what was said in the debate on 23rd May. I know of the hon. Gentleman's concern and the concern in his area over possible job losses at the Shotton works. He has led a deputation to my hon. Friend the Minister for Industry, and he has brought his town clerk to see me. There have been a fair number of representations made on these matters. I emphasise that the question of further investment at Shotton is primarily for the Corporation to decide. The Corporation must assess the possibilities in the context of its overall capacity requirements. When this report is made the Government will consider both the regional and social factors which are involved in this plan.
Of course these factors are essential. It would be wrong for anyone to go away with the thought that the Government are not as concerned as anyone about those repercussions. The Government wish to ensure a strong industry in coal and steel, and the Government believe that a unique opportunity is being provided by our entry to the Common Market. It is for that reason that I urge the Committee to

resist these Amendments, which have been a "hang-up" for this debate.

Mr. Michael Foot: I will do my best to answer directly the case which has just been put to the House. The Under-secretary claims that there are good prospects for the coal and steel industries in Europe, that we need have no fears from the powers which the High Authority is to possess and that all the alarms and anxieties which have been expressed can be easily disposed of. The hon. Gentleman went so far as to say, in what was an extraordinary statement, that there have been no discussions with the High Authority about the future of the industry.
I hope to go into all these matters in turn. In our opinion, the future of the coal and steel industries within the European Economic Communities should have been dealt with in separate Bills. We have always held the view that that should be the case. Many hon. Members on this side of the Committee, particularly my hon. Friends who represent coal mining and steel constituencies, have spent a large part of their political lives fighting for the proposition that these great industries should be made answerable to the elected House of Commons. Now we see that the considerable powers over these industries are to be transferred elsewhere to quite irresponsible bodies. Furthermore, the offence is made the deeper by the attempt which the Government have made throughout all these discussions to conceal these factors from us and to blur the realities of the situation.
I will come to some of the facts of the matter which are bound to affect the livelihood of people within the coal and steel industries. That is not saying that, if by any mischance the Bill is to go through and the Government timetable is fulfilled, those of us who have to face the situation, who represent coal or steel constituencies will not do everything in our power to ensure that our industries are successful. We will do that in the interests of our constituents and the country. But that does not alter the fact that we believe the Government and the Minister today have further offended against the facts of the situation by attempting to blur the realities, as in the case of the rest of the Bill, to such a great degree. Our charge is that it


blurs the responsibilities which are raised in different institutions.
I shall give some illustrations. First, there is the question of capital reconstruction. The Minister claims that there is no problem about capital structure and capital reconstruction in either the steel or coal industries. It is claimed that entry into the Community does not impair that in any way. That is not what anyone would deduce from reading Article 134 of the Treaty of Accession. I will not read it all through now, but anyone who reads that Article will see that the whole point of having that Article in the Treaty is that it imposes certain restrictions when we are under the High Authority. The point of being under the High Authority is that it should exercise certain high powers under the Treaty of Accession which we have signed.
The matter is further elaborated in Chapter 7 of the Treaty of Paris, which deals with interference with conditions of competition. The rules of competition are laid down which the High Authority is to exert and which it is given powers to exercise. That is the whole point of the operation. Therefore, the rules of competition will be laid down by the High Authority in Europe rather than this Parliament.
The hon. Gentleman argues that it does not make any difference to any matters of great importance. Nothing could be of greater importance to the steel industry, although it applies even more to the coal industry as a result of the recent strike. It is a question of whether capital reconstructions can be carried through or whether the High Authority will have anything to say about them. The hon. Gentleman may say that this is all clear and that there is no difficulty. That is not the view of one of his predecessors in office—I am not quoting the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), I am quoting his "bowling alley" companion, as we used to call him in those days, the present Minister of Posts and Telecommunications—when he argued that it was just as well to spend money on bowling alleys as steel works. The Under-Secretary seemed to be advocating that same policy today.
The hon. Member for Oswestry (Mr. Biffen), when we were debating the last

major essential capital reconstruction of the steel industry, put to the hon. Gentleman's companion, the present Minister for Posts and Telecommunications:
My hon. Friend says that the sum could not be used for writing off after 1972–73. Is this because he is advised that under the Treaty of Paris such writing off would be deemed to be subsidised competition?
The answer by the then Minister for Industry was:
It is because the corporation itself will be contributing to the reserve, hopefully, from its own retained earnings which it will use for these other purposes. Naturally, as my hon. Friend points out, the new environment in the European Coal and Steel Community, into which the corporation will be entering, undoubtedly has a very marked bearing on the extent to which it will be possible for the corporation even to appear to be subsidising its operations. So it will have to perform in a normal commercial manner in this respect, as in all others."—[OFFICIAL REPORT, 16th December, 1971; Vol. 828, c. 868.]

[Sir ROBERT GRANT-FERRIS in the Chair]

10.45 p.m.

That is a very clear reply from the hon. Gentleman's predecessor indicating that the Government would not have been able to carry out the capital reconstruction that they carried out in the steel industry if we were already in the Community.

I know that we have had a precedent. The right hon. Member for Wolverhampton, South-West (Mr. Powell) referred to the extraordinary precedent of the Government being in breach of the only agreement into which they have entered with the Common Market about the margin on floating exchanges. We have also had the extraordinary state of affairs of the Government saying, "Although we are eager to enter the monetary and economic union, we shall try to float the pound in the meantime." It is rather like a man saying that he has made up his mind to enter a monastery in order to reform his morals, but insists in the meantime on having several nights out in Soho. That is the way the Government operate their monetary policy.

Now the same policy is apparently to be applied to the steel industry. The Government say "We do not have to abide by it." The rules are laid down. These gentlemen in Europe have taken


the trouble to lay down, first, in the Treaty of Paris and then in the Article which we had to sign in the Treaty of Accession, that we had to give all the information about these matters to the then Minister for Industry which were recited to the House. Now we are told "It does not matter. We need not take any notice of all these documents. Nobody will say that they apply." I am doubtful whether that will necessarily be so.

We should have had a much clearer statement about capital reconstruction and whether the statement made by the then Minister for Industry was correct. If the statement made by the Undersecretary today is correct, he is in effect tearing up that section of the Treaty of Accession and the previous part of the Treaty of Paris.

Let as take, for example, the question of prices. Once again the question about the powers over prices is blurred. The Under-Secretary argues that going into the European Economic Community does not make any difference. So little difference, he did not have to discuss the matter. I should have thought that pricing policy was important. We all know why Lord Melchett wants to go in. He wants to escape from the attentions of the Government. I can understand that, although it is not an adequate excuse. The noble Lord wants to go in to escape altogether from the Government's surveillance of his prices. Of course he does. That is the main reason why he wants entry.

When the new Minister for Industry is asked about it, he does not give the answer as categorically as that. Yesterday, the Minister for Industry was asked by the hon. Member for Oswestry:
If the Government were unwise enough to move towards a system of price freeze or control, would my hon. Friend have authority under the Treaty of Paris to require compliance by the British Steel Corporation?
The Minister replied:
The price structure is for the industry to assess. Steel is operating in an internationally competitive market, and the intention of the BSC and the Government is that it should be profitable. On the role of intervention, my hon. Friend will be aware that the powers of direction which followed representation from the Consumer Council are being repealed by the European Communities Bill."—[OFFICIAL REPORT, 26th June, 1972: Vol. 839; c. 986.]

That was a perfectly correct reply. There is a great difference in the way that the steel industry will work; the Government will not have the power over prices which they have enjoyed so far—for example, in carrying through the great achievement by the Prime Minister, who boasted that he had intervened to cut the steel price increase from 14 to 7 per cent. The Government will not have the power to try to maintain the system of pricing we have had in the steel industry, which, on the whole, benefits our more distant regions. Instead, we shall have to adopt the system laid down in Europe.

Yet the Under-Secretary of State says that the Government do not have to have discussions with the Community and the Commission, whether it is desirable or not. He is not even well-informed about what the Government are doing. Perhaps the Government themselves do not know what the Brussels Commission is doing. I gave the hon. Gentleman plenty of opportunity. He could have obtained information by this time from the Department. I even asked the hon. Member for Cirencester and Tewkesbury to tell us what he knew about the discussions which the Commission is having on these matters.

Here then, we have, in the Under-secretary of State, a member of the Government telling us that we need not worry and that nothing of any importance is happening. Yet the document "Europe" tells us that the Commission is:
… proceeding to a detailed examination of the situation of the coal and steel industries in the United Kingdom…".
It is dated 24th and 25th April, 1972—not some date in 1967 or 1962, when some previous application was being made, but here and now. A question was asked of the Commission on the subject and it replied:
In the framework of the UK/EEC Council of Association, the High Authority and the Commission have been informed regularly on the evolution of the economic and social evolution of the coal and steel industries in the United Kingdom.
The hon. Gentleman was telling us a few minutes ago that there had been no consultation. According to the Commission, however, it has been regularly informed. Perhaps the Chancellor of the Duchy of Lancaster can help us out. We know that he has not taken much interest


in the subject but perhaps be can pick it up, because, after all, he is supposed to have negotiated all this. But it seems that he does not even know what has occurred.

Mr. Rippon: The position is exactly as stated in the 1971 White Paper. The position as far as the document and exchanges are concerned is exactly as set out by my hon. Friend the Under-Secretary of State. All sorts of things come out in the Commission; it does all sorts of research of its own. We have had no formal exchanges. What is clear is that the Community confirmed that it would not challenge the size or the legal status of the British steel industry.

Mr. Foot: I will come back to the "all sorts of things going on," because we have a right to know what is going on. The right hon. and learned Gentleman has tried to distract attention by his intervention from what is going on. We have never got an answer to the question of the 42 million tons. I have asked him whether he got an agreement from those he negotiated with for the steel industry's proposed extension of its programme of 40 to 42 million tons. He cannot say, apparently, because they may never even have been asked. All we know is that all sorts of things go on in the Commission.
I have read one paragraph and now I will read another in order to put this into context. This is the answer given by the Commission:
In the framework of the UK/EEC Council of Association, the High Authority and the Commission have been informed regularly of the economic and social evolution of the coal and steel industries in the United Kingdom.
That is what I read and it goes on:
This situation is at present"—
that is April, 1972—
is at present, the object of a detailed examination, in view of the accession of Great Britain to the European Communities, in order to prepare in good time the application of the ECSC Treaty to these industries.
If the Brussels Commission, on its own statement, is carrying out a detailed investigation of what is happening in our industries, first of all the House of Commons should have been told about it before the Bill and, secondly, the Minister in charge should know about it, instead of sitting there and trying to mis-

lead the Committee as he did a few minutes ago.
This is an illustration of the way these great industries have been dealt with in these negotiations by the right hon. and learned Gentleman, ever since he has been in charge.

Mr. Rippon: The position is exactly as I have stated and is not as stated in Europe News.

Mr. Foot: One of the purposes of parliamentary debate, as I have said on many occasions, is that when Ministers may seem to be guilty of the kind of attempt to mislead the Committee which the right hon. and learned Gentleman tried in the last few minutes, then we have an opportunity of seeing who is correct at Report stage. This is a Bill which affects the future of great industries, of industries in which many of us have constituents working.
We do not trust the word of the right hon. and learned Gentleman. We do not trust the way in which he conducted the negotiations for these great industries, in a most slipshod manner, and now, when we come to the single period of two hours left to us under this guillotine to discuss the future of these industries, he comes to us, incompetently briefed, and does not even know what is going on in Brussels.
The right hon. and learned Gentleman is not fit to be in charge of a Bill of this nature. He has behaved with consistent flippancy and has shown that he has relied solely on the guillotine and the fact that he has no Report stage in which he can be held to account. On those grounds alone, the Committee should fight this Bill.
We intend to have all these facts brought out; all these facts which they have been concealing so long in all these industries and I say to the right hon. and learned Gentleman who got up in the hope of relieving some of our anxieties, that the more the House of Commons connives at the blurring of responsibility for the future of these industries, the more they will add to the antagonism in the country about them, particularly at a time, as they should know, when the right hon. and learned Gentleman is pressing that there should be no expansion in the British steel industry. That is what 28 million tons mean. They do not seem to know it.
We were always promised that if some parts of the steel industry were to be run down, there would be investment on the scale of £3,000 million to £4,000 million over the next 10 years to ensure that other sections of industry would be built up. It is this which has necessitated the figure being kept down to 28 million tons. It becomes worse when the Government are trying to transfer authority for dealing with these industries away from the House of Commons where it belongs into the hands of irresponsible bodies in Europe. Indeed, the corporation which

many of us have fought to ensure shall be answerable to the House of Commons will become an irresponsible monster which nobody can get at, accountable to no one. This is the situation which the Government are—

It being Eleven o'clock The CHAIRMAN proceeded, pursuant to Order [2nd May], to put forthwith the Question already proposed from the Chair.

Question put, that the Amendment be made: —

The Committee divided: Ayes 260, Noes 270.

Division No. 249.]
AYES
[11.0 p.m.


Abse, Leo
Eadie, Alex
Kelley, Richard


Allaun, Frank (Salford, E.)
Edelman, Maurice
Kerr, Russell


Archer, Peter (Rowley Regis)
Edwards, Robert (Bilston)
Kinnock, Neil


Armstrong, Ernest
Edwards, William (Merioneth)
Lambie, David


Ashley, Jack
Ellis, Tom
Lamborn, Harry


Ashton, Joe
English, Michael
Lamond, James


Atkinson, Norman
Evans, Fred
Latham, Arthur


Bagier, Gordon A. T.
Ewing, Henry
Leadbitter, Ted


Barnett, Guy (Greenwich)
Faulds, Andrew
Lee, Rt. Hn. Frederick


Barnett, Joel (Heywood and Royton)
Fell, Anthony
Leonard, Dick


Batter, William
Fisher,Mrs. Doris (B'ham,Ladywood)
Lever, Rt. Hn. Harold


Benn, Rt. Hn. Anthony Wedgwood
Fitch, Alan (Wigan)
Lewis, Arthur (W. Ham, N.)


Bennett, James (Glasgow, Bridgeton)
Fletcher, Raymond (Ilkeston)
Lewis, Ron (Carlisle)


Bidwell, Sydney
Fletcher, Ted (Darlington)
Lomas, Kenneth


Biffen, John
Foley, Maurice
Loughlin, Charles


Bishop, E. S.
Foot, Michael
Lyon, Alexander W. (York)


Blenkinsop, Arthur
Ford, Ben
Lyons, Edward (Bradford, E.)


Boardman, H. (Leigh)
Forrester, John
Mabon, Dr. J. Dickson


Body, Richard
Fraser, John (Norwood)
McBride, Neil


Booth, Albert
Freeson, Reginald
McCartney, Hugh


Bottomley, Rt. Hn. Arthur
Garrett, W. E.
McElhone, Frank


Boyden, James (Bishop Auckland)
Gilbert, Dr. John
McGuire, Michael


Bradley, Tom
Ginsburg, David (Dewsbury)
Mackenzie, Gregor


Brown, Bob (N'c'tle-upon-Tyne,W.)
Golding, John
Mackie, John


Brown, Hugh D. (G'gow, Provan)
Gourlay, Harry
Mackintosh, John P.


Brown, Ronald (Shoreditch &amp; F'bury)
Grant, George (Morpeth)
Maclennan, Robert


Buchan, Norman
Grant, John D. (Islington, E.)
McMillan, Tom (Glasgow, C.)


Buchanan, Richard (G'gow, Sp'burn)
Griffiths, Eddie (Brightside)
McNamara, J. Kevin


Butler, Mrs. Joyce (Wood Green)
Griffiths, Will (Exchange)
Maginnis, John E.


Campbell, I. (Dunbartonshire, W.)
Hamilton, William (Fife, W.)
Mahon, Simon (Bootle)


Cant, R. B.
Hamling. William
Mallalieu, J. P. W. (Huddersfield, E.)


Carmichael, Neil
Hardy, Peter
Marks, Kenneth


Carter, Ray (Birmingh'm, Northfield)
Harrison, Walter (Wakefield)
Marsden, F.


Carter-Jones, Lewis (Eccles)
Healey, Rt. Hn. Denis
Marshall, Dr. Edmund


Castle, Rt. Hn. Barbara
Heffer, Eric S.
Marten, Nell


Clark, David (Colne Valley)
Hooson, Emlyn
Mason, Rt. Hn. Roy


Cocks, Michael (Bristol, S.)
Horam, John
Mayhew, Christopher


Cohen, Stanley
Houghton, Rt. Hn. Douglas
Meacher, Michael


Concannon, J. D.
Howell, David (Guildford)
Mellish, Rt. Hn. Robert


Conlan, Bernard
Huckfield, Leslie
Mendelson, John


Cox, Thomas (Wandsworth, C.)
Hughes. Rt. Hn. Cledwyn (Anglesey)
Mikardo, Ian


Crawshaw, Richard
Hughes, Mark (Durham)
Millan, Bruce


Cronin, John
Hughes, Robert (Aberdeen, N.)
Miller, Dr. M. S.


Crosland, Rt. Hn. Anthony
Hughes, Roy (Newport)
Milne, Edward


Crossman, Rt. Hn. Richard
Hunter, Adam
Mitchell, R. C. (S'hampton, Itchen)


Cunningham, G. (Islington, S.W.)
Hutchison, Michael Clark
Moate, Roger


Davies, Denzil (Llanelly)
Irvine,Rt.Hn.SirArthur(Edge Hill)
Molloy, William


Davies, Ifor (Gower)
Janner, Greville
Molyneaux, James


Davis, Clinton (Hackney, C.)
Jay, Rt. Hn. Douglas
Morgan, Elystan (Cardiganshire)


Davis, Terry (Bromsgrove)
Jeger, Mrs. Lena
Morris, Alfred (Wythenshawe)


Deakins, Eric
Jenkins, Hugh (Putney)
Morris, Charles R. (Openshaw)


de Freitas, Rt. Hn. Sir Geoffrey
Jenkins, Rt. Hn. Roy (Stechford)
Morris, Rt. Hn. John (Aberavon)


Dell, Rt. Hn. Edmund
John, Brynmor
Moyle, Roland


Dempsey, James
Johnson, James (K'ston-on-Hull, W.)
Mulley, Rt. Hn. Frederick


Doig, Peter
Johnson, Walter (Derby, S.)
Murray, Ronald King


Dormand, J. D.
Jones, Barry (Flint, E.)
Oakes, Gordon


Douglas, Dick (Stirlingshire,E.)
Jones, Dan (Burnley)
Ogden, Eric


Douglas-Mann, Bruce
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
O'Halloran, Michael


Duffy, A. E. P.
Jones, Gwynoro (Carmarthen)
O'Malley, Brian


Dunn, James A.
Jones, T. Alec (Rhondda, W.)
Oram, Bert


Dunnett, Jack
Kaufman, Gerald
Orme, Stanley




Oswald, Thomas
Rose, Paul B.
Tomney, Frank


Owen, Dr. David (Plymouth, Sutton)
Ross, Rt. Hn. William (Kilmarnock)
Torney, Tom


Paget, R. T.
Rowlands. Ted
Turton, Rt. Hn. Sir Robin


Palmer, Arthur
Sandelson, Neville
Urwin, T. W.


Pannell. Rt. Hn. Charles
Sheldon, Robert (Ashton-under-Lyne)
Varley, Eric G.


Parker, John (Dagenham)
Shore, Rt. Hn. Peter (Stepney)
Wainwright, Edwin


Parry, Robert (Liverpool, Exchange)
Short, Rt.Hn.Edward (N'c'tle-u-Tyne)
Walden, Brian (B'm'ham, All Saints)


Peart, Rt. Hn. Fred
Silkin, Rt. Hn. John (Deptford)
Walker, Harold (Doncaster)


Pendry, Tom
Silkin, Hn. S. C. (Dulwich)
Walker-Smith, Rt. Hn. Sir Derek


Pentland, Norman
Sillars, James
Wallace, George


Perry, Ernest G.
Silverman, Julius
Watkins, David


Powell, Rt. Hn. J. Enoch
Skinner, Dennis
Weitzman, David


Prentice, Rt. Hn. Reg.
Small, William
Wellbeloved, James


Prescott, John
Smith, John (Lanarkshire, N.)
Wells, William (Walsall, N.)


Price, J. T. (Westhoughton)




Price, William (Rugby)
Spearing, Nigel
Whitehead, Phillip


Probert, Arthur
Spriggs, Leslie
Whitlock, William


Rankin, John
Stallard, A. W.
Willey, Rt. Hn. Frederick


Reed, D. (Sedgelield)
Stoddart, David (Swindon)
Williams, Alan (Swansea, W.)


Rees, Merlyn (Leeds, S.)
Stonehouse, Rt. Hn. John
Williams, Mrs. Shirley (Hitchin)


Rhodes, Geoffrey
Strang, Gavin
Williams, W. T. (Warrington)


Richard, Ivor
Strauss, Rt. Hn. G. R.
Wilson, Alexander (Hamilton)


Roberts, Albert (Normanton)
Summerskill, Hn. Dr. Shirley
Wilson, William (Coventry, S.)


Roberts,Rt.Hn.Goronwy (Caernarvon)
Swain, Thomas
Woof, Robert


Robertson, John (Paisley)
Thomas, Jeffrey (Abertillery)
TELLERS FOR THE AYES:


Roderick, Caerwyn E.(Br'c'n&amp;R'dnor)
Thomson, Rt. Hn. G. (Dundee, E.)
Mr. Joseph Harper and Mr.


Rodgers, William (Stockton-on-Tees)
Tinn, James
James Hamilton


Roper, John






NOES


Adley, Robert
d'Avigdor-Goldsmid,Maj.-Gen. James
Heath, Rt. Hn. Edward


Alison, Michael (Barkston Ash)
Dean, Paul
Heseltine, Michael


Allason, James (Hemel Hempstead)
Deedes, Bt. Hn. W. F.
Hicks, Robert


Archer, Jeffrey (Louth)
Dixon, Piers
Higgins, Terence L.


Astor, John
Drayson, G. B.
Hiley, Joseph


Atkins, Humphrey
du Cann, Rt. Hn. Edward
Hill, John E. B. (Norfolk, S.)


Awdry, Daniel
Dykes, Hugh
Hill, James (Southampton, Test)


Baker, Kenneth (St. Marylebone)
Eden, Rt. Hn. Sir John
Holland, Philip


Balniel, Rt. Hn. Lord
Edwards, Nicholas (Pembroke)
Holt, Miss Mary


Batsford, Brian
Elliot, Capt. Walter (Carshalton)
Hordern, Peter


Beamish, Col. Sir Tufton
Elliott, R. W.(N'c'tle-upon-Tyne,N.)
Hornby, Richard


Bennett, Sir Frederic (Torquay)
Emery, Peter
Hornsby-Smith.Rt.Hn.Dame Patricia


Bennett, Dr. Reginald (Gosport)
Eyre, Reginald
Howe, Hn. Sir Geoffrey (Reigate)


Benyon, W.
Fenner, Mrs. Peggy
Howell, Ralph (Norfolk, N.)


Berry, Hn. Anthony
Fidler, Michael
Hunt, John


Biggs-Davison, John
Finsberg, Geoffrey (Hampstead)
Iremonger, T. L.


Blaker, Peter
Fisher, Nigel (Surbiton)
James, David


Boardman, Tom (Leicester, S. W.)
Fletcher-Cooke, Charles
Jenkin, Patrick (Woodford)


Boscawen, Robert
Fookes, Miss Janet
Johnson Smith, G. (E. Grinstead)


Bossom, Sir Clive
Fortescue, Tim
Jones, Arthur (Northants, S.)


Bowden, Andrew
Foster, Sir John
Joseph, Rt. Hn. Sir Keith


Braine, Sir Bernard
Fowler, Norman
Kellett-Bowman, Mrs. Elaine


Bray, Ronald
Fry, Peter
Kershaw, Anthony


Brinton, Sir Tatton
Galbraith, Hn. T. G.
King, Evelyn (Dorset, S.)


Brocklebank-Fowler, Christopher
Gardner, Edward
King, Tom (Bridgwater)


Brown, Sir Edward (Bath)
Gibson-Watt, David
Kinsey, J. R.


Bruce-Gardyne, J.
Gilmour, Ian (Norfolk, C.)
Kirk, Peter


Bryan, Sir Paul
Gilmour, Sir John (Fife, E.)
Kitson, Timothy


Buchanan-Smith, Alick(Angus,N&amp;M)
Glyn, Dr. Alan
Knight, Mrs. Jill


Buck, Antony
Godber, Rt. Hn. J. B.
Knox, David


Burden, F. A.
Goodhart, Philip
Lambton, Lord


Butler, Adam (Bosworth)
Goodhew, Victor
Lament, Norman


Campbell, Rt.Hn.G.(Moray&amp;Nairn)
Gorst, John
Lane, David


Carlisle, Mark
Gower, Raymond
Legge-Bourke, Sir Harry


Carr. Rt. Hn. Robert
Grant, Anthony (Harrow, C.)
Le Marchant, Spencer


Channon, Paul
Gray, Hamish
Lewis, Kenneth (Rutland)


Chapman, Sydney
Green, Alan
Lloyd, Ian (P'tsm'th, Langstone)


Chataway, Rt. Hn. Christopher
Griffiths, Eldon (Bury St. Edmunds)
Longden, Sir Gilbert


Chichester-Clark, R.
Grimond, Rt. Hn. J.
Loveridge, John


Clark, William (Surrey, E.)
Grylls, Michael
Luce, R. N.


Clarke, Kenneth (Rushcliffe)
Gummer, J. Selwyn
McAdden, Sir Stephen


Clegg, Walter
Gurden, Harold
MacArthur, Ian


Cockeram, Eric
Hall, Miss Joan (Keighley)
McCrindle, R. A.


Cooke, Robert
Hall, John (Wycombe)
McLaren, Martin


Cooper, A. E.
Hall-Davis, A. G. F.
Maclean, Sir Fitzroy


Cordle, John
Hamilton, Michael (Salisbury)
Macmillan,Rt.Hn.Maurice (Farnham)


Corfield, Rt. Hn. Sir Frederick
Hannam, John (Exeter)
McNair-Wilson, Michael


Cormack, Patrick
Harrison, Brian (Maldon)
McNair-Wilson, Patrick (NewForest)


Costain, A. P.
Harrison, Col. Sir Harwood (Eye)
Maddan, Martin


Critchley, Julian
Haselhurst, Alan
Madel, David


Crouch, David
Hastings, Stephen
Marples, Rt. Hn. Ernest


Crowder, F. P.
Havers, Michael
Mather, Carol


Davies, Rt. Hn. John (Knutsford)
Hawkins, Paul
Maudling, Rt. Hn. Reginald


d'Avlgdor-Goldsmid, Sir Henry
Hayhoe, Barney
Mawby, Ray







Maxwell-Hyslop, R. J.
Ramsden, Rt. Hn. James
Taylor, Sir Charles (Eastbourne)


Meyer, Sir Anthony
Rawlinson, Rt. Hn. Sir Peter
Taylor, Frank (Moss Side)


Mills, Peter (Torrington)
Redmond, Robert
Taylor, Robert (Croydon, N.W.)


Mills, Stratton (Belfast, N.)
Reed, Laurance (Bolton. E.)
Tebbit, Norman


Miscampbell, Norman
Rees, Peter (Dover)
Temple, John M.


Mitchell,Lt.-Col.C.(Aberdeenshire,W)
Rees-Davies, W. R.
Thatcher, Rt. Hn. Mrs. Margaret


Mitchell. David (Basingstoke)
Renton, Rt. Hn. Sir David
Thomas, John Stradling (Monmouth)


Money, Ernle
Rhys Williams, Sir Brandon
Thomas, Rt. Hn. Peter (Hendon, S.)


Monks, Mrs. Connie
Ridley, Hn. Nicholas
Thompson, Sir Richard (Croydon, S.)


Monro, Hector
Ridsdale, Julian
Thorpe, Rt. Hn. Jeremy


Montgomery, Fergus
Rippon, Rt. Hn. Geoffrey
Tilney, John


More, Jasper
Roberts, Michael (Cardiff, N.)
Trafford, Dr. Anthony


Morgan, Geraint (Denbigh)
Roberts, Wyn (Conway)
Trew, Peter


Morrison, Charles
Rost, Peter
Tugendhat, Christopher


Mudd, David
Royle, Anthony
van Straubenzee, W. R.


Murton, Oscar
Sandys, Rt. Hn. D
Vaughan, Dr. Gerard


Neave, Airey
Scott, Nicholas
Vickers, Dame Joan


Nicholls, Sir Harmar
Sharples, Richard
Waddington, David


Noble, Rt. Hn. Michael
Shaw, Michael (Sc'b'gh &amp; Whitby)



Normanton Tom
Shelton, William (Clapham)
Walker, Rt. Hn. Peter (Worcester)


Nott, John
Simeons, Charles
Ward, Dame Irene


Onslow, Cranley
Sinclair, Sir George
Warren, Kenneth


Oppenheim, Mrs. Sally

Weatherill, Bernard


Osborn, John
Skeet, T. H. H.
Wells, John (Maidstone)


Owen, Idris (Stockport, N.)
Smith, Dudley (W'wick &amp; L'mington)



Page, Rt. Hn. Graham (Crosby)
Soref, Harold
White, Roger (Gravesend)


Page, John (Harrow, W.)
Speed, Keith
Wiggin, Jerry


Parkinson, Cecil
Spence, John
Wilkinson, John


Percival, Ian
Sproat, Iain
Winterton, Nicholas


Peyton, Rt. Hn. John
Stainton, Keith
Wolrige-Gordon, Patrick


Pike, Miss Mervyn
Stanbrook, Ivor
Wood, Rt. Hn. Richard


Pink, R. Bonner
Steel, David
Woodnutt, Mark


Price, David (Eastleigh)
Stewart-Smith, Geoffrey (Belper)
Worsley, Marcus


Prior, Rt. Hn. J. M. L
Stodart, Anthony (Edinburgh, W.)
Wylie, Rt. Hn. N. R.


Proudfoot, Wilfred
Stoddart-Scott, Col. Sir M.
Younger, Hn. George


Pym, Rt. Hn. brands
Stokes, John
TELLERS FOR THE NOES:


Quennell, Miss J. M
Stuttaford, Dr. Tom
Mr. Michael Jopling and


Raison, Timothy
Tapsell, Peter
Mr. Marcus Fox.

Question accordingly negatived.

The CHAIRMAN then proceeded, pursuant to Order [2nd May], to put forthwith the Question necessary for the disposal of the business to be concluded at Eleven o'clock.

Question put, That this Schedule be the Third Schedule to the Bill: —

The Committee divided:  Ayes 270, Noes 261.

Division No. 250.]
AYES
[11.10 p.m.


Adley, Robert
Campbell, Rt.Hn.G.(Moray &amp; Nairn)
Elliott, Ft. W. (N'c'tle-upon-Tyne,N.)


Alison, Michael (Barkston Ash)
Carlisle, Mark
Emery, Peter


Allason, James (Hemel Hempstead)
Carr, Rt. Hn. Robert
Eyre, Reginald


Archer, Jeffrey (Louth)
Channon, Paul
Fenner, Mrs. Peggy


Astor, John
Chapman, Sydney
Fidler, Michael


Atkins, Humphrey
Chataway, Rt. Hn. Christopher
Finsberg, Geoffrey (Hampstead)




Fisher, Nigel (Surbiton)


Awdry, Daniel
Chichester-Clark, R.
Fletcher-Cooke, Charles


Baker, Kenneth (St. Marylebone)
Clark, William (Surrey, E.)
Fookes, Miss Janet


Balniel, Rt. Hn. Lord
Clarke, Kenneth (Rushcliffe)
Fortescue, Tim


Batsford, Brian
Clegg, Walter
Foster, Sir John


Beamish, Col. Sir Tutton
Cockeram, Eric
Fowler, Norman


Bennett, Sir Frederic (Torquay)
Cooke, Robert
Fry, Peter


Bennett, Dr. Reginald (Gosport)
Cooper, A. E.
Galbraith, Hn. T. G.


Benyon, W.
Cordle, John
Gardner, Edward


Berry, Hn. Anthony
Corfield, Rt. Hn. Sir Frederick
Gibson-Watt, David


Biggs-Davison, John
Cormack, Patrick
Gilmour, Ian (Norfolk, C.)


Blaker, Peter
Costain, A. P.
Gilmour, Sir John (Fife, E.)


Boardman, Tom (Leicester, S.W.)
Critchley, Julian
Glyn, Dr. Alan


Boscawen, Robert
Crouch, David
Godber, Rt. Hn. J. B.


Bossom, Sir Clive
Crowder, F. P.
Goodhart, Philip


Sowden, Andrew
Davies. Rt. Hn. John (Knutstord)
Goodhew, Victor


Braine, Sir Bernard
d'Avigdor Goldsmid, Sir Henry
Gorst, John


Bray, Ronald
d'Avigdor-Goldsmid,Maj.-Gen.James
Gower, Raymond


Brinton, Sir Tatton
Dean, Paul
Grant, Anthony (Harrow, C.)


Brocklebank-Fowler, Christopher
Deedes, Rt. Hn. W. F
Gray, Hamish


Brown, Sir Edward (Bath)
Dixon, Piers
Green, Alan


Bruce-Gardyne, J.
Drayson, G. B.
Griffiths, Eldon (Bury St. Edmunds)


Bryan, Sir Paul
du Cann, Rt. Hn. Edward
Grimond, Rt. Hn. J.


Buchanan-Smith, Alick(Angus,N&amp;M)
Dykes, Hugh
Grylls, Michael


Buck, Antony
Eden, Sir John
Gummer, Selwyn


Burden, F. A.
Edwards, Nicholas (Pembroke)
Gurden, Harold


Butler, Adam (Bosworth)
Elliot, Capt. Walter (Carshalton)
Hall, Miss Joan (Keighley)




Hall, John (Wycombe)
Madel, David
Scott, Nicholas


Hall-Davis, A. G. F.
Marples, Rt. Hn. Ernest
Sharples, Richard


Hamilton, Michael (Salisbury)
Mather, Carol
Shaw, Michael (Sc'b'gh &amp; Whitby)


Hannam, John (Exeter)
Maudling, Rt. Hn. Reginald
Shelton, William (Clapham)


Harrison, Brian (Maldon)
Mawby, Ray
Simeons, Charles


Harrison, Col. Sir Harwood (Eye)
Maxwell-Hyslop, R. J.
Sinclair, Sir George


Haselhurst, Alan
Meyer, Sir Anthony
Skeet, T. H. H.


Hastings, Stephen
Mills, Peter (Torrington)
Smith, Dudley (W'wick &amp; L'mington


Havers, Michael
Mills, Stratton (Belfast, N.)
Soref, Harold


Hawkins, Paul
Miscampbell, Norman
Speed, Keith


Hayhoe, Barney
Mitchell,Lt.-Col.C.(Aberdeenshire,W)
Spence, John


Heath, Rt. Hn. Edward
Mitchell, David (Basingstoke)
Sproat, Iain


Heseltine, Michael
Money, Ernle
Stainton, Keith


Hicks, Robert
Monks, Mrs. Connie
Stanbrook, Ivor


Higgins, Terence L.
Monro, Hector
Steel, David


Hiley, Joseph
Montgomery, Fergus
Stewart-Smith, Geoffrey (Belper)


Hill, John E. B. (Norfolk, S.)
More, Jasper
Stodart, Anthony (Edinburgh, W.)


Hill, James (Southampton, Test)
Morgan, Geraint (Denbigh)



Holland, Philip
Morrison, Charles
Stoddart-Scott, Col. Sir M.


Holt, Miss Mary
Mudd, David
Stokes, John


Hordern, Peter
Murton, Oscar
Stuttaford, Dr. Tom


Hornby, Richard
Neave, Airey
Tapsell, Peter


Hornsby-Smith.Rt.Hn.Dame Patricia
Nicholls, Sir Harmar
Taylor, Sir Charles (Eastbourne)


Howe, Hn. Sir Geoffrey (Reigate)
Noble, Rt. Hn. Michael
Taylor, Frank (Moss Side)


Howell, Ralph (Norfolk, N.)
Normanton, Tom
Taylor, Robert (Croydon, N.W.)


Hunt, John
Nott, John
Tebbit, Norman


Iremonger, T. L.
Onslow, Cranley
Temple, John M.


James, David
Oppenheim, Mrs. Sally
Thatcher, Rt. Hn. Mrs. Margaret


Jenkin, Patrick (Woodford)
Osborn, John
Thomas, John Stradling (Monmouth)


Johnson Smith, G. (E. Grinstead)

Thomas, Rt. Hn. Peter (Hendon, S.)


Jones, Arthur (Northants, S.)
Owen, Idris (Stockport, N.)
Thompson, Sir Richard (Croydon, S.)


Joseph, Rt. Hn. Sir Keith
Page, Rt. Hn. Graham (Crosby)
Thorpe, Rt. Hn. Jeremy


Kellett-Bowman, Mrs. Elaine
Page, John (Harrow, W.)
Tilney, John


Kershaw, Anthony
Parkinson, Cecil
Trafford, Dr. Anthony


King, Evelyn (Dorset, S.)
Percival, Ian
Trew, Peter


King, Tom (Bridgwater)
Peyton, Rt. Hn. John
Tugendhat, Christopher


Kinsey, J. R.
Pike, Miss Mervyn
van Straubenzee, W. R.


Kirk, Peter
Pink, R. Bonner
Vaughan, Dr. Gerard


Kitson, Timothy
Price, David (Eastleigh)
Vickers, Dame Joan


Knight, Mrs. Jill
Prior, Rt. Hn. J. M. L.
Waddington, David


Knox, David
Proudfoot, Wilfred
Walker, Rt. Hn. Peter (Worcester)


Lambton, Lord
Pym, Rt. Hn. Francis
Ward, Dame Irene


Lamont, Norman
Quennell, Miss J. M.
Warren, Kenneth


Lane, David
Raison, Timothy
Weatherill, Bernard


Legge-Bourke, Sir Harry
Ramsden, Rt. Hn. James
Wells, John (Maidstone)


Le Marchant, Spencer
Rawlinson, Rt. Hn. Sir Peter
White, Roger (Gravesend)


Lewis, Kenneth (Rutland)
Redmond, Robert
Wiggin, Jerry


Lloyd, Ian (P'tsm'th, Langstone)
Reed, Laurance (Bolton, E.)
Wilkinson, John


Longden, Sir Gilbert
Rees, Peter (Dover)
Winterton, Nicholas


Loveridge, John
Rees-Davies, W. R.
Wolrige-Gordon, Patrick


Luce, R. N.
Renton, Rt. Hn. Sir David
Wood, Rt. Hn. Richard


McAdden, Sir Stephen
Rhys Williams, Sir Brandon
Woodnutt, Mark


MacArthur, Ian
Ridley, Hn. Nicholas
Worsley, Marcus


McCrindle, R. A.
Ridsdale, Julian
Wylie, Rt. Hn. N. R.


McLaren, Martin
Rippon, Rt. Hn. Geoffrey
Younger, Hn. George


Maclean, Sir Fitzroy
Roberts, Michael (Cardiff, N.)



Macmillan.Rt.Hn.Maurice (Farnham)
Roberts, Wyn (Conway)
TELLERS FOR THE AYES:


McNair-Wilson, Michael
Rost, Peter
Mr. Michael Jopling and


McNair-Wilson, Patrick (New Forest)
Royle, Anthony
Mr. Marcus Fox.


Maddan, Martin
Sandys, Rt. Hn. D.





NOES


Abse, Leo
Boyden, James (Bishop Auckland)
Cronin, John


Allaun, Frank (Salford, E.)
Bradley, Tom
Crosland, Rt. Hn. Anthony


Archer, Peter (Rowley Regis)
Brown, Bob (N'c'tle-upon-Tyne,W.)
Crossman, Rt. Hn. Richard


Armstrong, Ernest
Brown, Hugh D. (G'gow, Provan)
Cunningham, G. (Islington, S.W.)


Ashley, Jack
Brown, Ronald (Shoreditch &amp; F'bury)
Davies, Denzil (Llanelly)


Ashton, Joe
Buchan, Norman
Davies, Ifor (Gower)


Atkinson, Norman
Buchanan, Richard (G'gow, Sp'burn)
Davis, Clinton (Hackney, C.)


Bagier, Gordon, A. T.
Butler, Mrs. Joyce (Wood Green)
Davis, Terry (Bromsgrove)


Barnett, Guy (Greenwich)
Campbell, I. (Dunbartonshire, W.)
Deakins, Eric


Barnett, Joel (Heywood and Royton)
Cant, R. B.
de Freitas, Rt. Hn. Sir Geoffrey


Baxter, William
Carmichael, Neil
Dell, Rt. Hn. Edmund


Benn, Rt. Hn. Anthony Wedgwood
Carter, Ray (Birmingh'm, Northfield)
Dempsey, James


Bennett, James (G'gow, Bridgeton)
Carter-Jones, Lewis (Eccles)
Doig, Peter


Bidwell, Sydney
Castle, Rt. Hn. Barbara
Dormand, J. D.


Biffen, John
Clark, David (Colne Valley)
Douglas, Dick (Stirlingshire, E.)


Bishop, E. S.
Cocks, Michael (Bristol, S.)
Douglas-Mann, Bruce


Blenkinsop, Arthur
Cohen, Stanley
Duffy, A. E. P.


Boardman, H. (Leigh)
Concannon, J. D.
Dunn, James A.


Body, Richard
Conlan, Bernard
Dunnett, Jack


Booth, Albert
Cox, Thomas (Wandsworth, C.)
Eadie, Alex


Bottomley, Rt. Hn. Arthur
Crawshaw, Richard
Edelman, Maurice







Edwards, Robert (Bilston)
Leonard, Dick
Probert, Arthur


Edwards, William (Merioneth)
Lever, Rt. Hn. Harold
Rankin, John


Ellis, Tom
Lewis, Arthur (W. Ham, N.)
Reed, D. (Sedgefield)


English, Michael
Lewis, Ron (Carlisle)
Rees, Merlyn (Leeds, S.)


Evans, Fred
Lomas, Kenneth
Rhodes, Geoffrey


Ewing, Henry
Loughlin, Charles
Richard, Ivor


Faulds, Andrew
Lyon, Alexander W. (York)
Roberts, Albert (Normanton)


Fell, Anthony
Lyons, Edward (Bradford, E.)
Roberts, Rt.Hn.Goronwy(Caernarvon)


Fisher, Mrs. Doris(B'ham,Ladywood)
Mabon, Dr. J. Dickson
Robertson, John (Paisley)


Fitch, Alan (Wigan)
McBride, Neil
Roderick,Caerwyn E.(Br'c'n&amp;R'dnor)


Fletcher, Raymond (Ilkeston)
McCartney, Hugh
Rodgers, William (Stockton-on-Tees)


Fletcher, Ted (Darlington)
McElhone, Frank
Roper, John


Foley, Maurice
McGuire, Michael
Rose, Paul B.


Foot, Michael
Mackenzie, Gregor
Ross, Rt. Hn. William (Kilmarnock)


Ford, Ben
Mackie, John
Rowlands, Ted


Forrester, John
Mackintosh, John P.
Russell, Sir Ronald


Fraser, John (Norwood)
Maclennan, Robert
Sandelson, Neville


Freeson, Reginald
McMillan, Tom (Glasgow, C.)
Sheldon, Robert (Ashton-under-Lyne)


Garrett, W. E.
McNamara, J. Kevin
Shore, Rt. Hn. Peter (Stepney)


Gilbert, Dr. John
Maginnis, John E.
Short,Rt.Hn.Edward(N'c'tle-u-Tyne)


Ginsburg, David (Dewsbury)
Mahon, Simon (Bootle)
Silkin, Rt. Hn. John (Deptford)


Golding, John
Mallalieu, J. P. W. (Huddersfield,E.)
Silkin, Hn. S. C. (Dulwich)


Gourlay, Harry
Marks, Kenneth
Sillars, James


Grant, George (Morpeth)
Marsden, F.
Silverman, Julius


Grant, John D. (Islington, E.)
Marshall, Dr. Edmund
Skinner, Dennis


Griffiths, Eddie (Brightside)
Marten, Neil
Small, William


Griffiths, Will (Exchange)
Mason, Rt. Hn. Roy
Smith, John (Lanarkshire, N.)


Hamilton, William (Fife. W.)
Mayhew, Christopher
Spearing, Nigel


Hamling, William
Meacher, Michael
Spriggs, Leslie


Hardy, Peter
Mellish, Rt. Hn. Robert
Stallard, A. W.


Harrison, Walter (Wakefield)
Mendelson, John
Stoddart, David (Swindon)


Healey, Rt. Hn. Denis
Mikardo, Ian
Storehouse, Rt. Hn. John


Heffer, Eric S.
Millan, Bruce
Strang, Gavin


Hooson, Emlyn
Miller, Dr. M. S.
Strauss, Rt. Hn. G. R.


Horam, John
Milne, Edward
Summerskill, Hn. Dr. Shirley


Houghton, Rt. Hn. Douglas
Mitchell, R. C. (S'hampton, Itchen)
Swain, Thomas


Howell, Denis (Small Heath)
Moate, Roger
Thomas, Jeffrey (Abertillery)


Huckfield, Leslie
Molloy, William
Thomson, Rt. Hn. G. (Dundee, E.)


Hughes, Rt. Hn. Cledwyn (Anglesey)
Molyneaux, James
Tinn, James


Hughes, Mark (Durham)
Morgan, Elystan (Cardiganshire)



Hughes, Robert (Aberdeen, N.)
Morris, Alfred (Wythenshawe)
Tomney, Frank


Hughes, Roy (Newport)
Morris, Charles R. (Openshaw)
Torney, Tom


Hunter, Adam
Morris, Rt. Hn. John (Aberavon)
Turton, Rt. Hn. Sir Robin


Hutchison, Michael Clark
Moyle, Roland
Urwin, T. W.


Irvine, Rt. Hn. Sir Arthur (Edge Hill)
Mulley, Rt. Hn. Frederick



Janner, Greville
Murray, Ronald King
Varley, Eric G.


Jay, Rt. Hn. Douglas
Oakes, Gordon
Wainwright, Edwin


Jeger, Mrs. Lena
Ogden, Eric
Walden, Brian (B'm'ham, All Saints)


Jenkins, Hugh (Putney)
O'Halloran, Michael
Walker, Harold (Doncaster)


Jenkins, Rt. Hn. Roy (Stechford)
O'Malley, Brian
Walker-Smith, Rt. Hn. Sir Derek


John, Brynmor
Oram, Bert
Wallace, George


Johnson, James (K'ston-on-Hull, W.)
Orme, Stanley
Watkins, David


Johnson, Walter (Derby, S.)
Oswald, Thomas
Weitzman, David


Jones, Barry (Flint, E.)
Owen, Dr. David (Plymouth, Sutton)
Wellbeloved, James


Jones, Dan (Burnley)
Paget, R. T.
Wells, William (Walsall, N.)


Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Palmer, Arthur
Whitehead, Phillip


Jones, Gwynoro (Carmarthen)
Panneil, Rt. Hn. Charles
Whitlock, William


Jones, T. Alec (Rhondda, W.)
Parker, John (Dagenham)
Willey, Rt. Hn. Frederick


Kaufman, Gerald
Parry, Robert (Liverpool, Exchange)
Williams, Alan (Swansea, W.)


Kelley. Richard
Pearl, Rt. Hn. Fred
Williams, Mrs. Shirley (Hitchin)


Kerr, Russell
Pendry, Tom
Williams, W. T. (Warrington)


Kinnock, Neil
Pentland, Norman
Wilson, Alexander (Hamilton)


Lambie. David
Perry, Ernest G.
Wilson, William (Coventry, S.)


Lamborn, Harry
Powell, Rt. Hn. J. Enoch
Woof, Robert


Lamond, James
Prentice, Rt. Hn. Reg.



Latham, Arthur
Prescott, John
TELLERS FOR THE NOES:


Leadbiller. Ted
Price, J. T. (Westhoughton)
Mr. Joseph Harper and


Lee. Rt. Hn. Frederick
Price, William (Rugby)
Mr. James Hamilton.

Schedule 3 accordingly agreed to.

It being after Eleven o'clock, The CHAIRMAN left the Chair to report Pro-

gress and ask leave to sit again, pursuant to Order [2nd May].

Committee report Progress; to sit again tomorrow.

Orders of the Day — HARBOURS DEVELOPMENT (SCOTLAND) BILL

Order for Second Reading read.

11.22 p.m.

The Secretary of State for Scotland (Mr. Gordon Campbell): I beg to move, That the Bill be now read a Second time.
This short Bill is being introduced as a swift response to the need to overcome a difficulty and to seize an opportunity. A short time ago companies connected with North Sea oil developments made it clear that the harbour of refuge at Peter-head was admirably placed and would be most suitable for the servicing of oil rigs. But a local Act of 1886 restricts the development of the harbour for any other purposes than as a refuge. The Secretary of State for Scotland is the harbour authority and I therefore examined immediately what could be done to remove the obstacle and positively to help the North Sea developments.
I found that legislation was needed and that it was needed immediately to enable work to be started this year. Without it the servicing of some oil rigs might have to be done abroad. I am sure the House will wish to assist the Bill in this purpose. It would be most unfortunate if the eminently suitable assets of the harbour of refuge were unavailable, because of an 1886 Act, when they could be the basis for important industrial development in Scotland.
The Bill applies to harbours where the Secretary of State for Scotland is the harbour authority. There is one other of these besides Peter head. It is at Uig in the Isle of Skye, but there are at present no proposals for similar development there.
The Bill provides the Secretary of State with powers to develop, maintain and manage harbours, authorise others to do so either on his behalf or at their own expense.

Dr. J. Dickson Mabon: The right hon. Gentleman said that only one other harbour, namely, Uig, is affected, but subsection (1) contains the phrase
by virtue of powers or duties vested in him by any Act or order".
I presume that there must be one other Act or Order affecting Uig. This is a

rushed Bill. Is the right hon. Gentleman sure that that provision does not pick up many Acts or orders, or many parts of Acts or orders, affecting many harbours other than Peterhead and Uig?

Mr. Campbell: The hon. Gentleman failed to hear what I said earlier. It is not a question of Acts. What I said was clear, but I am prepared to say it again for the benefit of the hon. Gentleman at this late hour. What the Bill is concerned with are harbours where the Secretary of State for Scotland is the harbour authority, and there are two such harbours in Scotland. That is the answer to the hon. Gentleman's question.

Mr. John Smith: Will the right hon. Gentleman give way?

Mr. Campbell: No. I am introducing the Bill, and there will be an opportunity for hon. Members to raise matters during the debate that will follow. My hon. Friend the Under-Secretary of State will answer any questions that are asked. If I may be allowed to conclude this short introductory speech, my hon. Friend will note and later deal with any points that are raised. I think that it will be better if hon. Members make their points if they are called to take part in the debate.
The Bill applies to harbours where the Secretary of State for Scotland is the harbour authority. That is the point.

Dr. Dickson Mabon: rose—

Mr. Campbell: I shall give way to the hon. Gentleman again, because he clearly misunderstood the point.

Dr. Dickson Mabon: I hope that I did not. I am trying to help the right hon. Gentleman. Many speeches will not be made tonight if the right hon. Gentleman can explain the difference between the wording in the Bill and what he has said. The right hon. Gentleman defined the Secretary of State for Scotland as being the harbour master, as it were, of two harbours in Scotland and of no others, but that is not what the Bill says. Subsection (1) refers to
harbours made or maintained by him by virtue of powers or duties vested in him by any Act or order".
Is the right hon. Gentleman certain that harbours attached to the Congested Districts (Scotland) Act, 1897, and the harbours exclusive of the Harbours Act, 1964


but included, for example, in the Sea Fisheries Act, 1951, are all unaffected by the Bill? If the right hon. Gentleman is sure about that, some speeches may not be made.

Mr. Campbell: I give the hon. Gentleman the assurance that the Bill applies to the two harbours to which I have referred. The Sea Fisheries Act is separate. If there are queries about any harbours, they can be raised tonight or in Committee. The intention of the Bill is to apply to harbours where the Secretary of State is the harbour authority, and there are only two such harbours in Scotland—Peterhead and Uig. If hon. Members think that the Bill might apply to other harbours, I shall be pleased to consider the points raised by them. If other harbours are likely to be affected we may have to make amendments to the Bill, but the intention is to cover only those two harbours to which I have referred and to deal with one in particular, because it is only the harbour of refuge at Peterhead which needs to be dealt with urgently.
That is the intention of the Bill, but in Committee we shall gladly deal with queries about individual harbours in Scotland if hon. Members think that they might be affected by the Bill.
The Bill provides the Secretary of State with powers to develop, maintain and manage harbours, and authorise others to do so either on his behalf or at their own expense. It also gives him powers of acquisition of land by agreement or compulsorily for the purposes of developing a harbour, subject to the procedural safeguards in subsection 1(3). Subsection 1(4) permits the amendment or repeal of existing statutes of local application by order. The main purpose here is to modify the local Act of 1886 if it proves inconsistent or unsuitable.
The Bill does not affect the fishery harbour of Peterhead, which is separate from the harbour of refuge. We intend that fishing interests, and the fishermen's right of access through the harbour of refuge, will be fully safeguarded. We are determined also to ensure that the effects of any changes on local interests will be fully considered, and to avoid any undesirable effects on the environment.
A preliminary estimate of the cost of development over a period of two years is between £2 million and £3 million.
The Scottish Office Departments have had extensive discussions with prospective developers, including the companies connected with the oil industry, and organisations wishing to share in the harbour development. Urgent discussions have also taken place with the County Council and representatives of the Peterhead Harbour Trust.

Mr. J. Grimond: Does the provision about the acquisition of land also refer only to land adjacent to these two harbours? There is a great deal of talking about the acquisition of land in my constituency. Am I right in saying that the Bill would not apply to that at all?

Mr. Campbell: I know the situation at Lerwick, which I imagine is what the right hon. Gentleman is thinking about. The Bill would apply to Peterhead only, or to Uig if a similar situation arose there.
The Bill allows me to authorise any suitable development, such as the construction of new harbour works, to cater for the specialised needs of the service vessels. Furthermore, the Bill also permits the Secretary of State to undertake these developments himself, if it is expedient to do so. We shall certainly use these powers if this proves to be necessary for the orderly development of the harbour in engineering, commercial and planning terms.
From the identification of the problem at Peterhead to the launching of the Bill has been a matter of a few weeks. This is an example of the way in which the Government can act quickly and decisively to give the new North Sea oil industry the important help which it needs. It is only seven months since the first announcement was made that oil had been found in the North Sea in quantities and conditions which made extraction worth while. That was the announcement by BP. But major operations in drilling exploration had been launched well before that by a number of companies. It has not been possible to foresee exactly what the varied requirements and problems of this new industry would be. But the Government


have been ready to act quickly. There are plans and developments of different kinds connected with North Sea oil in progress from Lerwick in the Shetlands to the Forth. I am doing everything I can to encourage as much development and business resulting from Scottish oil to be carried out in Scotland as possible. So far we have been able to provide for all the installations and developments that have been required along our coastline, while arranging additional expenditure on roads, ports and the infrastructure needed to support the new industry.
The Bill will play its part by enabling a very suitable harbour to be used in a way thoroughly beneficial to Scotland.

11.35 p.m.

Mr. William Ross: The Secretary of State is right in saying that this Bill came upon us rather suddenly. I think it was the Saturday after the House had risen for the Whit sun Recess that I received a letter from him. It was marked "Private and Confidential", but since then he has told me that I can freely use any information in it as it is no longer confidential. He said that they had come across snags in relation to Peterhead and they could only be surmounted in a particular way. There was a danger, if the Bill was limited to Peterhead, that it would be construed as a hybrid Bill and could not become law this Session.
I was not very happy about the terms of the letter. Remember, we had just finished the Committee stage of the Scottish housing Bill which was very important to the Opposition and one which was subject to a guillotine. We were also in the throes of discussing the European Communities Bill, also the subject of a guillotine. These were both important Bills on which we thought there should be some discussion. It seems to be the rule of the Government that if a Bill is important to the Opposition it is guillotined; if it is important to them then there should be no discussion at all.
In that letter it was suggested to me that all stages of the Bill should be taken formally, that is on the nod, and that there should be nothing said at all. As the Secretary of State said in his letter, to get round the hybridity problem he was taking a general power, and I could not see how this could be done. As he

had commissioned me to confidentiality I could not discuss it with all my colleagues and, although I readily gave him to understand that we would not hold up the Bill, I felt that he was duty bound to give Scottish Members, and any others who wished to come in, the right to comment on this matter. After all, we are spending something like £2 million to £3 million in two years, between 1972–4, and it was a bit much for the right hon. Gentleman to do that and then, having received his letter during the recess, for him to say that he would like my answer before the House resumed if not earlier. I do not know who wrote the letter; I know who signed it, but I can hardly think that he even read it because I still cannot work out what that last sentence means.

Mr. Gordon Campbell: I was in a hurry and I dictated that letter. I admit it was not happily worded, but I think that the urgency was clear.

Mr. Ross: The shortcomings of the letter are now explained. I spoke to the right hon. Gentleman on the telephone and suggested how we should handle this. I said that we should take it late at night and we would not be disposed to object if he took the Committee stage in the Second Scottish Standing Committee. We have done everything to preserve the rights of the House and at the same time have not impeded the progress of the Bill.
One other reason why I thought it essential for us to make some comments on this subject was that for a long time many of us have been anxious to have a discussion on the implications of North Sea oil and the effect on the Scottish economy of the Government's activities. While I know that this is not entirely the occasion for that, since the Bill is intended to facilitate action to be taken to support exploration and exploitation of North Sea oil, it does come into the discussion. From that point of view, I very much doubt when Queen Victoria signed the Act of 1886 that she ever dreamed that the harbour refuge that was to be built by what was termed in the original Bill "male Scotch prisoners" would ever be used for the purposes of getting oil, a new British resource, from the North Sea.
In my accustomed fashion, I spent some considerable time in parliamentary


archaeology in the Library trying to find, first, the 1886 Act, which I eventually tracked down. I discovered I had to get it photographed, to be told only two hours afterwards that some copies of the Act had been issued by the Scottish Office. I had tried unsuccessfully to track down the Order in Council of 1960, under which the Lord High Admiral, to quote the original Statute, had passed over his rights in respect of the harbour of refuge to the Secretary of State. It was not available in the House of Commons Library or the House of Lords Library.
It would have been appreciated if the Secretary of State—the right hon. Gentleman is anxious to get the support of all Members on a Bill like this—had sent all this information to all Scottish Members of Parliament so that the kind of questions which naturally arise in our minds when hurried legislation like this presents itself could have been obviated. If that had been done a lot of trouble would have been saved.
I am not yet entirely clear why the Bill is necessary or, if it is necessary, why it should be limited to these two harbours. The Minister, of course, has not mentioned the two harbours. There is a good Parliamentary reason why he did not do so, as it might have put the right hon. Gentleman in some little trouble from the point of view of our constitutional parliamentary procedure. However, I am surprised that he did not take further powers in respect of other harbours. In relation to many of the other harbours we are circumscribed by the activities of the Ministry of Transport, which has been giving loans rather than grants. The Minister could have taken unto himself the power to facilitate progress in respect of those.
One of the matters that has emerged—one here refers to the fact that it is only seven months ago since a strike was proved—is that there has been a considerable under-rating by everybody concerned of the real potential of the North Sea. I can remember, even from my recollection of papers which I have had to read on this subject, that there are other areas than those in which oil has been found that potentially are very valuable. I wonder to what extent this country has properly assessed the value of the potential and how to get the best

out of it. I remember reading—I think it was in the Financial Times in about November of last year—an article which said that we were throwing potential resources away by the way we were letting out the areas—the article also suggested that the areas were far too big—for exploration.
No doubt there should be a different approach. There is no reason why we should rest on the fact that something was done in 1964 by the President of the Board of Trade under the previous Conservative Administration and followed by the Labour Administration. There is no reason why we should not appreciate now that it is possible to change our mind about the further licensing of areas in the North Sea. There is the question of maximising the revenue that we can obtain from North Sea oil. These things are worthy of consideration, bearing in mind that no less a person than the Chairman of the Conservative Party in Scotland has been outspoken on this subject. It is no good the Prime Minister or anyone else in the Government telling us to read on. It was specific—
Scotland's Tory leader accuses Government over oil policy.
Part of the reason for the Government racing in with the Bill is to show that the Scottish Office is alive and that the Government are going to make the best out of it. However, Chris Baur, the industrial correspondent of the Scotsman, was quite clear.

Mr. Ian MacArthur: Did he refer to the Bill?

Mr. Ross: Yes. He referred to the activities relating to everything concerned with North Sea oil. We are on Second Reading and the hon. Member for Perth and East Perthshire (Mr. MacArthur) has been long enough in the House to appreciate that there are many things one cannot talk about in Committee which one can express relating to a Bill that proposes to deal with one aspect of the matter, discussing why it should or should not be given a Second Reading, and suggesting how it could be further improved. It might be further improved to take account of some of the suggestions put forward by Sir William McEwan Younger.

Mr. MacArthur: rose—

Mr. Ross: I do not know what the hon. Gentleman is so nervous about.

Mr. MacArthur: On a point of order, Mr. Deputy Speaker. The right hon. Gentleman is entering a very interesting sphere about the licensing of exploration rights in the North Sea, and so on. With respect, I fail to see how this relates to the development of Peterhead Harbour. I suggest that the right hon. Gentleman might return to the Bill.

Mr. Deputy Speaker (Sir Robert Grant-Ferris): I am sure the right hon. Gentleman realises these things and will not go too far from the subject of the Bill. Otherwise it might encourage others of his hon. Friends to go even further.

Mr. Ross: I think you know me well enough, Mr. Deputy Speaker, to appreciate that I would not trespass in that way.

Mr. Robert Hughes: Further to that point of order, Mr. Deputy Speaker. With respect, as it may help other speakers in the debate, the Secretary of State certainly widened the issue.

Mr. Ross: I do not think the Secretary of State went too wide. He was quite right to express the urgency of the Bill. It certainly relates to North Sea oil and ensuring that Scotland gets the most out of it. The right hon. Gentleman was playing his little part in it. After all, the licensing is nothing to do with the Secretary of State. That is a matter for the Department of Trade and Industry, as covered by the Continental Shelf Act, 1964.
We are being asked to spend between £2 million and £3 million on this proposal. That is a fair sum of money. Therefore, we are right to ask why and what kind of return we shall get on it.
Some important points arise from the text of the Bill. When considering spending this amount of money on oil development and exploration to assist companies, which are not exactly poverty-stricken, we must take account of the criticism made of the Government by no less a person than the Leader of the Scottish Conservative Party, who said:
1. That they had seriously under-estimated the real potential to the economy of the North Sea development.
2. That in failing to think out the impact on the UK economy British industry had

been left totally unprepared to provide equipment and services.
We are dealing with equipment and services in the Bill.

Mr. MacArthur: All the more reason for the Bill.

Mr. Ross: He continued:
3. That in granting exploration licences, no effort had been made to insist on the use by oil developers of domestic oil facilities.
Sir William McEwan Younger, who was an opponent of nationalisation, virtually went on to talk of nationalisation and State participation in this sphere.
These questions have never been answered. If the Secretary of State is playing his little part with his £2 million to £3 million, we are entitled to ask about the conditions attaching to it. If this money is to be spent we are entitled to ask what return we may expect on it. Or is it to be given as a present to somebody or other? Are we charging for the use of the facilities, or how are we charging? How long does the right hon. Gentleman think the oil boom will last? I have never had an answer to that question.
The time that the developers will be using Peterhead surely must be related to the cost of this development. We should not race into these things in a foolhardy way. Therefore, I assume the Secretary of State will give the assurance that it is a matter which will be there not only for two or three years, but for some time, to justify the expenditure.
These are the kind of questions which people will ask and will want answered in view of the criticism which has been made. Are the Government likely to change their mind about what Sir William McEwan Younger considers their generosity in this matter and their failure to take the steps to tie up the maximising of the benefits from revenues by participation in the exploitation of the oil?
The limitation in the Bill is very strict. It is
… to develop, maintain and manage …
and this is to be done by the Secretary of State himself or by others whom he authorises to do so. The right hon. Gentleman never told us what is in his mind. Who are the others he is to authorise? Will it be the developing companies? Or will it be the Peterhead


Harbour Trustees? Under the Peter-head Harbour of Refuge (Transfer) Order, 1960, the trustees have been acting as the Secretary of State's agents. The annual fisheries Vote includes a sum of £500 or £600 as the cost to the Secretary of State of maintaining the harbour of refuge. He should make it clear whether he is to do this work himself or tell us whom he is to authorise to do it for him. Will he, for example, hand it over, at their own expense, to the developers? He said that he had been in discussion with the county council, the developers and the trustees, and he should be in a position to give us this information.
The Bill is limited to
…harbours in Scotland, made or maintained by…
the Secretary of State, and here the intervention of my hon. Friend the Member for Aberdeen, North (Mr. Robert Hughes) is relevant. The words are not "made and maintained" but "made or maintained". The right hon. Gentleman should get his civil servants to make sure that there are no harbours maintained by the Secretary of State
…under any Act or order…
because it may be that the right hon. Gentleman is taking a wider power than he realises. I am not necessarily objecting to that, but we should know what we are doing.
Clause 1(1) says:
…and to do all such things as may be necessary or expedient for that purpose.
In Clause 1, the Secretary of State is being given power to acquire land. The Peterhead Harbour of Refuge Act, 1886, is very specific about land to be acquired.

Mr. Dick Douglas: There was a map with it.

Mr. Ross: As my hon. Friend says, there was a map. The Act itself even mentioned Mrs. Ogston's farm. Indeed, all the land was referred to by name. The deviations permitted were strictly limited. It may well be that the right hon. Gentleman is now taking a wider power, because Clause 1(4) says that
…he may by order repeal, amend or adapt…
limiting legislation, and that is an important power.
Would such an order be purely administrative? There is nothing in the Bill to indicate whether the House will know anything about such an order if it gives the right hon. Gentleman this Bill. But he should bring these orders before the House so that it can deal with them by the affirmative or negative procedures. Such an order can include
…incidental, supplementary and consequential provisions…
and that is the power to legislate—a serious power.
We are also told in the Explanatory Memorandum that this exercise, in addition to the capital expenditure, will cost about £50,000 a year, together with the employment of about 10 additional harbour officials. Does this mean that we shall have a Supplementary Estimate for the £2 million or £3 million, or for the portion spent this year, which would mean another opportunity to check the right hon. Gentleman's expenditure?
I should be glad if the Minister would tell us something about the orders. How soon does he foresee that he will be able to produce them? We do not object to the Bill and I am glad that the Secretary of State, having seen the point, has brought this Measure forward.
There was another point I suggested to the Secretary of State in conversation or by letter; can we be sure that the people of Peterhead are happy about this? Unlike the position at Hunterston, where he took the powers himself, in this case I presume that planning permission remains a responsibility of the local authority at Peterhead. Are they happy, or are there likely to be objections to this development? I do not think objections are likely, but the House has a right to know.
I should be obliged for a general idea of Government thinking about changes in the way they are handling North Sea oil questions in the light of the widespread criticism in Scotland. I do not blame the Secretary of State, but he has to say whether he is entirely happy about the way things are handled.

11.57 p.m.

Mr. Patrick Wolrige-Gordon: I do not want to pursue the right hon. Gentleman the Member for Kilmarnock (Mr. Ross) into the North Sea, but I express my appreciation of his general attitude to the Bill. I should


also like to say how much I welcome the Bill and congratulate the Secretary of State for taking such speedy action to set it on its way through the House, in time, we hope, to enable the country in general and Peterhead in particular to take full advantage of the burgeoning oil industry in North-East Scotland.
The first point I wish to raise was mentioned by the right hon. Gentleman the Member for Kilmarnock at the end of his speech. It concerned the people of Peterhead. It may seem strange to have public anxiety over jobs lost in one part of the country and a similar kind of public anxiety over jobs possibly gained in another part of the country, but such is the case, and it is natural.
The colossus of a world oil company is bound to upset entirely the balance of a place like Peterhead, and they are wise to realise that. I echo the question put by the right hon. Gentleman: can we be sure that the Secretary of State, in discharging his responsibility for the development of a harbour of refuge, will keep the people fully informed on his plans?
I should like to go further and to ask whether he will be sure to consult the people so that local people may have the chance to contribute their local knowledge and to assess the future of the prosperous development of their town. Such freedom and the possibility of participation will do a great deal to allay public anxiety and possible disquiet generally.
The effects of this legislation will be to convert the harbour of refuge at Peterhead to a full-scale commercial harbour with the prime object of servicing the oil industry. This is a dramatic change, inconceivable until a short while ago, and a change in the environment of the town.
What provision will my right hon. Friend make for alternative amenity for the burgh, and when? What steps will be taken to preserve the links? What compensation is available for loss of value to the houses facing the harbour of refuge? I want only an assurance that my right hon. Friend will take amenity fully into account.
I welcome my right hon. Friend's assurances on fishing, but at the beginning of March the Harbour Trustees in

Peterhead submitted a scheme to the Department for further essential development work in the fishing harbour to cope with the tremendous growth of the fishing industry. Although assurances are valuable, actions speak louder than words, and the application has not so far yielded much fruit. The improvements are needed now; may we be told when they will come?
The right hon. Member for Kilmarnock asked about the return on the investment. I am delighted to hear that note from the Opposition benches, and it is an important point. I, too, would like to know from where the initial estimate of £2 to £3 million came, as there has not been much time in which to make the calculations.

12.1 a.m.

Mr. J. Grimond: I, too, should like to know what return the public purse will get for the expenditure of £2 to £3 million, particularly bearing in mind that we have no idea for how long the oil companies will operate. We may be undertaking works which may have only a short life for all we know.
Secondly, I ask for elucidation of the drafting of the Bill. According to the Long Title it is a Bill to
Enable the Secretary of State to develop, maintain and manage, or authorise other persons so to do, harbours in Scotland, made or maintained by him for any purpose, and for purposes connected therewith.
The Title seems to imply that the Bill could apply to harbours made in the future, otherwise it would have referred to harbours which have been made or which are maintained by him. I imagine that it is possible under certain Acts for the Secretary of State to undertake harbour works, and I should like to know whether I am right in that.
I am not certain whether the drafting is intended to limit the Bill to harbours and piers which are constructed in a particular way by the Secretary of State for Scotland. There must be many works in the North of Scotland made by various public authorities. Does the title impose a limitation? For instance, works in Lyness must be made by the Government although not technically by a Secretary of State. I am not certain what is the distinction.
The major point to which I wish to draw attention is that in Shetland and Orkney the impact of oil raises great planning problems concerned both with the effect of that new industry upon the whole fabric of the community and with the use of land and harbour facilities. At Kirk-wall and Lerwick there are large schemes for extending the harbours. Those schemes were started not primarily in connection with the oil industry but in connection with the new means of sea transport, but they have, rightly, been expanded to take into account the supposed needs of the oil companies.
The schemes are being dealt with under the normal procedure and as far as I know, we have been able to get round many of the snags that might be expected. But it is possible that other harbour works, on-shore works and off-shore works connected with buoys, and so on, will be necessary around the coast, particularly in Shetland. I am not suggesting that the Secretary of State should cause these works to be undertaken. Probably the strongest case is that they should be primarily a matter for the local authority. The proper handling of the construction of these works, bearing in mind their probable effect upon local communities, is a matter of great importance.
I wonder whether the Bill goes far enough and whether we should not be looking at the present provisions for compulsory purchase of land for these purposes. The present procedures for undertaking harbour and pier works so far have been aimed at either transport or fishing. There are considerable differences between procedures for the two types of harbour. They are slightly out of date now. That fact, in some ways, makes for complications. It would be out of order to go too far into this question during the discussion of the Bill, but it is relevant, because the Bill gives the Secretary of State power to take land by compulsory purchase. The situation over the land near the harbour refuge at Peterhead may be duplicated in the north, although the problem of the harbour itself may not arise.
Urgent consideration should be given to the right way of handling a situation where it became necessary to create a major anchorage for oil tankers on the coast of Scotland, with its associated shore works. This is a matter primarily

for the local authorities. But the Government should consider the question. The public authorities should give the subject very early attention, so that it need not be hastened through, as to some extent this Bill has been hastened, at a somewhat late period.

12.7 a.m.

Mr. Robert Hughes: I should like to give a general welcome to the Bill. Once it became known there was a technical difficulty in the exploitation of the land round the harbour at Peterhead then the problem had to be solved as quickly as possible. One understands the problems experienced by the Secretary of State in getting a Bill drafted which would get through all its stages before the Summer Recess.
Nevertheless, there are many questions which have to be asked because there are problems facing harbours and ports in Scotland in relation to North Sea oil. With that rationale behind it, the introduction of the Bill became necessary, because of North Sea oil. In his introductory remarks the Secretary of State made it clear that that was so. He went on to say this was only one of a number of different actions which he and his Government were taking to try to get the benefit of North Sea oil for Scotland.
The right hon. Gentleman was trying to argue the case—as was inevitable—to answer the criticisms made of himself and his party by his own party chairman in Scotland. He told us how much he thought the Government had done to help North Sea oil. What has been done is welcome.
One is forced to ask oneself why it is that the Government has turned a somersault on their policy of six months ago. Six months ago we were told in Parliament, in answer to a Question—and in answer to letters—that there was no possibility of grants being made available for the development of harbours, for whatever purposes. We were told that the Minister had taken unilateral action, as he was entitled to do under previous legislation, to grant or not to grant moneys to harbours. The Department of the Environment decided that it was against its general policy to give grants, that the grants to harbours cease. Now we are told in the Bill that grants are to come back again. But nowhere in the remarks


of the Secretary of State or in the Bill are we told how the £2 million to £3 million will be spent. We do not know whether there will be outright grants, or loans at the prevailing rate of interest plus a percentage to discourage harbours from looking to the Government for a cheap source of money. All this is dropped in this Bill, and we are bound to ask why there is this sudden change.
Why do the Government ask for these wide powers for only two harbours, Peter-head and Uig? There may be good reasons why they are not mentioned in the Bill. Nevertheless, the Bill seeks very wide powers. But is the Secretary of State satisfied that it goes far enough? It maybe that the right hon. Gentleman has been unable to change the minds of his right hon. Friends the Secretary of State for Trade and Industry and the Secretary of State for the Environment about giving grants to harbours, and therefore he may be saying simply, "Here is a way in which I can help Peterhead".
I do not object to Peterhead being helped. I know that the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) has been subjected to considerable pressure locally about the possibility of the environment being damaged and the way of life of the people of Peterhead being changed by the arrival of the oil industry. One understands that. However, I am sure that the hon. Gentleman will agree that the work is essential for the people of the whole North-East.
Neither am I being parochial and saying that Peterhead is getting the kind of assistance that Aberdeen wanted six months ago. I welcome the help being given to Peterhead. But the fact remains that Aberdeen was treated very shabbily when it was looking for £1½ million to develop its harbour for the benefit of the oil industry and to bring in new work. The hon. Member for Aberdeenshire, East mentioned the balance between the traditional fishing industry and the new oil industry. It is a little ironical that it was only when the Government decided to help fishery harbours to enable them to compete with the EEC fishing industries that that help was forthcoming to Aberdeen Harbour Board to enable it to develop the fishery side of the harbour. Even though the help has been made available, Aberdeen Harbour Board

still has to find £400,000 to proceed with its development on the fisheries side. So it is essential for the Secretary of State to proceed in this way with the development of North Sea oil and the development of the fisheries harbour.
One is forced to the view that the Bill should have been about the development of harbours to deal with North Sea oil rather than being confined to two specific harbours. It should have been wider in its scope. The Secretary of State knows that the developments at Aberdeen harbour are not finished and that the Harbour Board is looking at plans for future development. Where will it get its money? Will it be told that because fingers were burned in the case of the Mersey Docks and Harbour Board, it will not get grants and loans but will have to stand on its own feet?
In my view, the Secretary of State has no idea of the way that harbours and ports should develop. He is drifting along on a tide of indecision. As problems crop up, it is a case of panic stations and a Bill is rushed through. The right hon. Gentleman thinks that the Opposition will put up with anything because it will be embarrassing for us to object to the Bill or to vote against it. He thinks that we shall let it go through on the nod and not worry about the general position. But we are concerned about the general position. The right hon. Gentleman's indecision means that we may have to go through the paraphernalia that we have experienced in the past of trying to get help for our constituencies which desperately need work and development by begging, cajoling and doing all that we can to obtain assistance.
The Secretary of State is failing to take a great opportunity. I do not expect him to be all-embracing in his attitude or to envisage every possibility. If one examines the recent history of the area and the Gaskin Report, which was supposed to be a projection of how the North-East of Scotland would develop, one will not find the word "oil" mentioned. It is very hard to find a mention of North Sea gas in that report. It is mentioned, but only as a possibility of it being piped from the north of England to the north-east of Scotland.
There have been great changes in the past five years which can distort and


alter the Government's philosophy. The Secretary of State has had plenty of warning about the problems of harbours and development. He knows what he has been faced with in respect of the Aberdeen Harbour Board. I am extremely disappointed that whilst urgent action has been taken to deal with one specific problem, the Secretary of State has not taken the opportunity to prepare a wider Bill which would enable him to deal with the problems as they arise in the future. In other words, he should have taken powers which would have made it unnecessary to come back to the House again, at this hour of the night, with a panic Bill to deal with something about which he had been well warned.

12.16 a.m.

Mr. Iain Sproat: Like previous speakers, I believe that this matter must be seen in the context of the overall development of the North Sea in response to the challenge of North Sea oil. In that context, I sincerely congratulate my right hon. and hon. Friends on the urgent action which they have taken in regard to Peterhead. I congratulate them not only on that but also on the whole structure improvements in the North-East, particularly infrastructure, and on the speed of planning procedure. This is very much appreciated in the North-East. Its momentum has been given added force by the Scottish Office in getting through future planning procedures at a decent speed. Unlike the hon. Member for Aberdeen, North (Mr. Robert Hughes), I congratulate my right hon. and hon. Friends on the energy and action they put into securing the loan, and later the grant, for Aberdeen harbour, about which we had so many anguished discussions.
A lot of rubbish is talked about the position of the Scottish Office vis-à-vis North Sea oil; indeed, not all the rubbish is talked in the House—[HON. MEMBERS: "Oh."] My experience in close and frequent contacts with my right hon. and hon. Friends in the Scottish Office is that they are absolutely on the ball with regard to Scottish oil.
I seek two assurances from my hon. Friend the Minister. First, in the general euphoria about oil—which we all share, and the reasons for which we appreciate—I hope that we shall never forget the interests of the fishing industry, which,

after all, will still be here long after the oil has gone. Even though, in response to questions from the right hon. Member for Kilmarnock (Mr. Ross) and others, we are talking of a perspective of 20, 30 or 50 years, this is not a fly-by-night—

Mr. Ross: Are we?

Mr. Sproat: If the right hon. Gentleman would read the newspapers with as much concern as he puts into parliamentary archaeology, he would know that.
I hope that what we are now giving to Peterhead does not mean that we shall see a transfer of attention and concentration away from the great city of Aberdeen to Peterhead.

12.20 a.m.

Dr. J. Dickson Mabon: The hon. Member for Aberdeen, South (Mr. Sproat) has done a service tonight to his own party, if to nothing else. No doubt he will one day make the grade as correspondent for the Conservative version of Pravda. Certainly that loyalty is unrequited when one considers the assurances he has asked of his right hon. Friend the Secretary of State.
The right hon. Gentleman's speech did not deal overall with the question of North Sea oil. He said that the Bill dealt with two harbours. But it does not do that because it deals with one harbour only, although it could affect two.

Mr. Ross: Mr. Ross: It deals with only half of a harbour.

Dr. Mabon: Yes, only half a harbour, but we could argue about which half. Basically it deals with Peterhead harbour. The right hon. Gentleman could have introduced a hybrid Bill or he could have been part sponsor of, or could have witnessed, a hybrid Bill. I realise how difficult that is. I am glad that he did not, in view of the timescale. But the Secretary of State should have seized the opportunity in the Bill of dealing with more harbours than those he mentioned.
For example, Aberdeen harbour is subject to the most complicated legal construction. If it becomes an important port as a result of North Sea oil, any development there will require legislation. I am not acquainted with the


problems of Dundee but I am quite certain that some reference will have to be made at some time in terms of public investment in Dundee and in the amount of public and private Acts dealing with Dundee harbour.
There may be a time—perhaps not far away, and perhaps even in the next Session of Parliament—when we may have to deal with matters affecting the acquisition of land and the development of harbours in tiny fishing ports in Orkney and Shetland. We are told that there may be considerable discoveries in that region such as we never expected.
I did not quite accept the Secretary of State's apologia that the Government are moving swiftly to deal with the situation. We were told towards the end of 1970 and in the early months of 1971 what a tremendous boon North Sea oil represented for the Scottish economy. It is sad that the Scottish Office did not advise Ministers of the absolute importance of being prepared, not only in financial terms but in legislative terms to take over some of the small ports of Scotland. There is doubt as to which harbours the Bill relates. If the Secretary of State is right when he insists that it refers to but two harbours, it is high time that it did not. It is high time we had an all-embracing Bill covering many other harbours also.
I understand the point that was being made by the right hon. Member for Orkney and Shetland (Mr. Grimond). In such a case, there would have to be much closer scrutiny of the Bill to see exactly what powers the Government were taking. The hon. Member for Aberdeen-shire, East (Mr. Wolrige-Gordon) has a constituency interest in the Bill. He says he is worried about the participation of the local people in the project. Every protection that his local people have in the order and in the Act which is referred to indirectly in the Bill may be dealt with by the Secretary of State without consulting Parliament if Clause 1 is un-amended. There is no affirmative Resolution procedure to insist that the Secretary of State must tell us why he is making a change in the provisions of the past order or the past Act concerning Peterhead harbour. That is intolerable, and I hope that the Under-Secretary will

say that he accepts that this sweeping procedure cannot be allowed to remain in the Bill.
There has to be provision for affirmative orders. An affirmative order does not have to be spoken to. It depends upon the Members concerned, or upon the Opposition, whether the matter is raised, but there must be a right to protest and to raise matters of individual or collective need if the Government seek to amend these Acts and orders. Whether or not the Bill applies only to Peterhead now and later to Uig, this proviso ought to be in the Bill.
I realise that the right hon. Gentleman has acted quickly in the time-scale of the matter, but I am sorry that he has not taken matters a little further. When debating Clause 1 of the Industry Bill in Committee we were told that we could not have a general grant attributed to ports or harbours, no matter where they were situated or what size they were, because the Government did not think that it was proper to deal with ports because, in their view, they were service industries. Whenever I hear the argument about distinguishing between manufacturing and service industries there leaps to my mind the memory of the right hon. Member for Moray and Nairn (Mr. Gordon Campbell) who spent five or six years on these benches telling us when we were the Government about the wickedness of making this decision.

Mr. Gordon Campbell: I visited a number of service industries and discovered how grateful they are for what the Government have done in removing the discrimination against them.

Dr. Mabon: The ports are annoyed with the Secretary of State, as well as with other Ministers, for keeping them out of the Industry Bill. The right hon. Gentleman ought to speak to the Clyde Port Authority and many others to find out what they think. We have not reached the state in the Committee considering the Industry Bill to know the position fully, but we were told that under Clause 7 there would perhaps be selective investment in ports and harbours of all kinds and sizes. In other words, Mr. Dennis Kirby, the new Industrial Development Officer for Scotland, will be in a position to recommend participation of the kind mentioned in that Bill.
The right hon. Gentleman seems to think £2 million to £3 million will be spent on this during the next two or three years, but that is not what the Bill says. The Bill gives an alternative. We are to vote a sum of only £50,000 for administrative expenses. We are not told who makes the choice, whether it is the proposer or the Government, or both.

Mr. Douglas: I wonder whether my hon. Friend would direct his attention to the Financial Resolution which accompanies the Bill. It does not lay down any figure at all.

Dr. Mabon: I do not want to debate the Financial Resolution, but I am entitled to refer to the financial effects of the Bill as explained in the Explanatory Memorandum, and that says that if other persons are empowered to do these approved works the cost to the State will be £50,000 per annum, but that if the Secretary of State undertakes these developments the cost will be between £2 million and £3 million. We have not yet been told who the other likely persons could be.

Mr. Ross: Hiving off.

Dr. Mabon: We do not know who they are. I should be surprised if it is the Peterhead Harbour Trust. I do not know how it would raise that sum, unless it had a backer. In that case, who would be its backer? Or would the money come direct from the backer? There is nothing sinister about this. I do not see why Parliament cannot be given this information. These are not confidential discussions between the Government and a firm which, if they were made public, would endanger the firm's operations. This is a legitimate matter for hon. Members to raise, and we should be told more about it.
We should be told whether the Secretary of State is saying, "No, it looks like me", or whether he says, "I think it should be the others." I do not agree with the others participating in the investment. All investments in the development of harbours and ports for the intake of oil from the North Sea bed should be by the State, which should charge sufficient not only to repay that investment but to recoup some of the disadvantages that communities like Peterhead, and individuals in them, may suffer. I hope

that the selective moneys under the Industry Bill or any future Bill will be regarded in the same light.
We return to Sir William McEwan Younger's criticism. It is not simply to play with Conservative Members to make these points. Unlike any other Conservative Party Chairman in Scotland that I have ever known, he has done a service by making stringent cricticisms of his own party. I am sure he makes them in the hope that his party will take them to heart and not regard him as a crypto-Socialist about to desert it. That would be nonsense. One of his criticisms is that the Government have not intervened sufficiently to capture for the public good the riches coming from North Sea oil. One richness is the ability to develop port and harbour installations and to charge for them, to make a business out of giving a service to the bringing in of oil and distributing of oil on the mainland.
I am rather disappointed that the Bill is so confused and rushed. I understand the need for it and the need not to oppose it. But if the Secretary of State wants the good will of Members on both sides he must equip us more readily with the information behind such a Bill. I am sure that the Second Reading will be completely unopposed, but I hope that in Standing Committee we shall receive complete assurances from the right hon. Gentleman that only two harbours are mentioned, and that we have the material to prove that that is so from his personal records. It would not be harmful for him to provide each hon. Member representing a Scottish constituency with the background to the Bill.
In replying tonight, the Under-Secretary should answer the questions posed by various hon. Members, and in particular he should tell us who is behind this development, other than the Government. Let us know who might spend £2 million to £3 million.
The Secretary of State should also seriously consider before we go into Committee whether he is making a mistake in leaving the Bill circumscribed to two harbours, and whether he might use the Bill, which is expressed in very general terms, to be the linchpin by which he can safeguard future development in the various small harbours in Scotland. That may not be possible, but he must tell us


a bit more about it, and why the Bill cannot be more substantial than it appears to be now.

12.34 a.m.

Mr. Robert Maclennan: It was natural that the whole House would welcome the Bill in so far as it has proved necessary to remove a legal impediment to the development of the Peterhead harbour of refuge. But the whole House must also have felt that the Secretary of State in introducing the Bill has shown himself to be perfunctory in his understanding of the requirements and inadequate in his explanation of needs which have brought the Bill before the House.

Mr. Gordon Campbell: I could have spoken about the exploration and the success in the Forties Field and the fact that Peterhead is so near to the Forties, and the way in which things would operate but I thought hon. Members had been following these events and I would not need to go into them.

Mr. Maclennan: There can be no doubt in the right hon Gentleman's mind, from the criticism which he has suffered at the hands of his own party chairman and of Members of this House, that the people of Scotland are following these developments with the greatest interest. They are not convinced that he is looking ahead to the potential and the problems which may face those exploiting these possibilities, if our country is to benefit from them. It is not good enough for the Secretary of State to say he has brought forward this little Measure which removes a legal impediment to the development of one harbour of refuge. There are many other places in Scotland, from Lerwick to Dundee which have different problems.
Why have we had no opportunity to scrutinise the Secretary of State's thinking on these problems? It is not good enough for him to take umbrage when hon. Members express their interest and the interest of the people of Scotland in these developments. This is a highly ambiguously worded Bill. The expression in Clause 1 (1) enabling him to take powers to develop harbours "made or maintained by him" does not on the face of it lead anyone to assume that it is a

reference to the harbour of refuge at Peterhead and it is natural that we should wish to examine this in some depth.
He did not produce one scintilla of evidence to prove that what he was asserting was the position. He quoted nothing whatever in the way of statutory provisions which he alleged this Bill would amend in some way. He gave no answer to the intervention of my hon. Friend the Member for Greenock (Dr. Dickson Mabon) about whether harbours built under the Congested Districts (Scotland) Act might conceivably be affected by the Bill. He simply asserted, and repeated the statement, that it referred only to Peterhead and we had to take his word for this. He cannot really object to the fact that we wish to make assurance doubly sure.
What I want to put to him, without any wish to make a narrow point, is this. I do not believe, and I think most people in Scotland take this view, that he has looked ahead to the needs of the servicing of the oil fields in the many sectors already subjected to exploration. We have new developments west of the Orkneys and he has not given any indication of his interest in the servicing of these areas. There are two or three possible sites in my constituency. There is Loch Eriboll on the north coast, the harbour at Scrabster and the harbour at Wick. I do not know whether he has even considered whether these are areas that could be developed under the existing law. It is extraordinary for him to come here tonight and deal with this massive problem in such an ad hocway. He is rushing through this little Bill which deals only with one minor part of the problem, and then brushing aside any attempts to find out what the position is regarding some of the other areas which may benefit from this development and actions which may be absolutely necessary if the exploration is to go ahead and be exploited as quickly as possible.
The Secretary of State has failed to prove to the House that he has any strategy for the development of the industry. He has shown that he has been quick to respond to the evidence of an impediment to development in a particular case, but that is not evidence of what he sought to assert at the beginning, that he has a general grasp of the problem and that he is acting with speed


to bring about the exploitation of the oil industry.
I hope that the Under-Secretary, in winding-up the debate, will be able to speak at length and not feel himself under any pressure of time in answering the specific questions which have been put to him by myself and a number of other hon. Members. I, like a number of other hon. Members who have spoken, find it astonishing that we have had no explanation from the Secretary of State on the financial aspects of the Bill. There has been no explanation how the sum of £2 million to £3 million is arrived at, who is to be the beneficiary of this public money, what return there is to be on it, whether the money was being sought by a public authority, a commercial interest, an oil company or what.
It is not good enough for the Secretary of State to come to the House and brandish these figures in a general way without further explanation. It may be we shall not even find ourselves spending the money, but we should know how the figure has come to appear on the front page of the Bill in the Memorandum explaining its financial effects. We should have had a much more detailed explanation than the cursory read through the Clauses which the Secretary of State embarked upon tonight. I am sure that the whole House felt it was an entirely inadequate performance.

12.42 a.m.

Mr. Dick Douglas: The Secretary of State in an intervention indicated that he could have spoken for an hour on this particular measure in giving the background to the oil industry. Let me refer him, with great respect, to the last occasion when he spoke extensively on this issue which was at the oil seminar at Aviemore. The right hon. Gentleman said:
I would like to thank and congratulate the Scottish Council and particularly Sir Willliam McEwan Younger for the idea of the Forum on this subject, and the very successful arrangements.
I wonder whether the Secretary of State still shares the view that the forum was useful? The right hon. Gentleman seems to have learnt little whereas Sir William McEwan Younger has learnt a great deal.

Mr. Gordon Campbell: I said during Question Time last Wednesday that the point which Sir William was reported in the Press as raising, is rather less recognisable when one reads the full context of his speech, because it was critical of both Governments. Those points were aired quite freely in the discussion during the two days at the forum. They did not make headline news then. Sir William was the person who brought this forum together. It was a most successful forum, as the hon. Member for Clackmannan and East Stirlingshire (Mr. Douglas) knows, because he attended.

Mr. Douglas: I do not dispute that for one moment, but the point is still valid that here we have a sheik in Campbell tartan, a marauding interventionist Secretary of State, coming forward with a Bill that asserts, "I require Parliament to spend on Peterhead Harbour, which I own and which I am responsible for, £2 million to £3 million." Why the Secretary of State requires the Bill is beyond my ken. I do not know why the Bill is necessary. If the Secretary of State owns the harbour and if he had anticipated events, it would have been a relatively simple device to get the money that he requires on the Scottish Office Vote. Why did not he think of that device if he owns the harbour, and has done specifically since 1960?

Mr. Gordon Campbell: I might be able to help the hon. Gentleman. First, the Scottish Council was among those who came to the people who ran the forum only four or five weeks ago saying that this impediment was there and asking whether we could do something about it. Secondly, neither the Secretary of State nor anybody else has the power to carry out development.

Mr. Douglas: We keep coming back to this point. The oil forum was held not four or five weeks ago, but in February, and the knowledge of the requirement for this proposal goes back a considerable time before that. I am not cavilling at the expenditure of the money, but at the need to do it in this way.
The Secretary of State has indicated to the House that this sum is required because of the vast exploration that is taking place in the North Sea. The House does not get information about the cost


of exploration and development operations comprehensively; the Department responsible estimates that the work undertaken under licences at present amounts at least to £300 million. We are about to spend public money to the tune of £2 million to £3 million to provide a service for those who will erect production platforms and use this harbour to service their drilling rigs, and so on.
I welcome an interventionist Secretary of State. My objection to this Measure is that the right hon. Gentleman is not interventionist enough. If the Scottish Office requires £2 million to £3 million, certain questions ought to be answered publicly. Will this money be subject to the same rate of return in discounted cash flow terms as the public corporations are normally expected to obtain over the life of the asset? That is a specific question which requires a specific answer.
If the sums are done, they must be related to the potentialities of the market. Therefore, the Secretary of State, or his Ministers, must have some idea of that market. Are we likely to get the low band of figure of 100 million tons of oil from the North Sea by the 1980s which would roughly equal our present needs, or will the larger figure now being quoted of about 300 million tons be the resources of that area? If it is the larger figure, perhaps this Measure is too puny and meagre. In that event we might seek in Committee to request the Secretary of State to take more extensive powers than he seems willing to take at this time.
I do not want to prolong the debate unduly at this hour, but these questions must be answered. The criticisms levelled by Sir William McEwan Younger at the attitude of the Scottish Office and of the Government generally are extremely perturbing. They go much deeper than how we dispense with licences and the returns to the nation now and in future.
The requirement to spend this small sum in terms of public expenditure compared with the totality of the potentialities of the North Sea ought to be taken out of the present context and looked at more comprehensively than the Secretary of State seems to have done.
I welcome the Bill because it seems to be an emergency Measure. I hope that in exploiting this invaluable new

source of indigenous energy we shall not proceed in this hand to mouth way.
I ask the Secretary of State, once he has this Bill, to sit back with his colleagues in the Government and think out how much more interventionist he should be and to devise a public instrument with which publicly to control and exploit the resources of this area. I hope that he will not simply go on saying that the oil companies know best. I deny that assertion and a useful and valuable Secretary of State would also deny that they know how best to use these assets.

12.50 a.m.

Mr. Harry Ewing: We on this side of the House very much regret that the Bill has not provided the opportunity for a full-scale debate on the future of the North Sea oil industry and the part it will play in the economic future of Scotland over the next 40 years. The hon. Member for Aberdeen, South (Mr. Sproat) said that a great deal of rubbish was spoken on the subject, some of it in this House. I would not want to pass judgment on that statement, but even if it were true the principal reason would be that the Secretary of State is so reluctant to allow such discussion in the House. The subject is being debated and discussed not in the House but in the country. If any hon. Member kids himself that this is not an important issue, or that the issues in the Bill are not important, let him listen to what people are saying in Scotland.
Under the Bill, £2 million to £3 million are to be spent not on two harbours but on one. The Secretary of State said that the harbour of Uig was included but that it had no prospect of being developed at this stage or even in the distant future. We are entitled to draw from that the assumption that the money will be spent on half of Peterhead harbour.
There are other developments on the East Coast of Scotland which are neither harbours nor havens. For example, there is the development in the constituency of my hon. Friend the Member for Kirkcaldy Burghs (Mr. Gourlay), at Methil, on the site of the old Wellesley Colliery, where Dorman, Redpath and Long is levelling the coal bins and building structures for the construction of drilling rigs to prospect for oil If aid


is to be given, that area should certainly be considered. Then there are other developments on the East Coast, not least the off-shore terminal to be constructed by British Petroleum. That terminal and its environments should be considered also when we are discussing developments under the Bill.
I want, without straying from order, to say something about the life span of oil expected in the North Sea strike. It is something like 40 years. This is important because in essence it means that facilities for servicing rigs to harvest the oil from the North Sea will not be there for 40 years, but for some time shorter. While I welcome this Measure, it is important to recognise—and the hon. Member for Aberdeen, East (Mr. Wolrige-Gordon) made the point—that massive changes are to be made to the landscape in areas which service the rigs. It is important that when these changes are being made consideration is given to the effects which will be a long time away.
I want future consideration to be given to the time when these facilities are no longer required so that the landscape might be less scarred. The companies which disturb that landscape have a responsibility and the Secretary of State should be assured that the responsibility is exercised to be sure that the landscape is left in a state which will make the environment no worse and possibly better than it is today.
I welcome, even at this stage, the Secretary of State being converted to the idea of intervening in the oil industry, because one of the first Questions I asked when I came to the House last year was that the Prime Minister should appoint a Minister to the Scottish Office solely responsible for the development of North Sea oil. I have asked time and time again whether the Prime Minister and the Secretary of State are satisfied with the co-ordination between Government Departments on the question of North Sea oil.
I am not saying that the Bill we are discussing is a panacea, but it is a step in the right direction, and I ask at this late stage only that the Secretary of State should look closely at the oil industry in Scotland. If we do not get that, there will be no benefits to the Scottish or the British economy and, in order to get it

right, it is important that the Government should play a primary part in development.

12.58 a.m.

Mr. James Sillars: We are all sympathetic to those who wish to speak in the debate, particularly my hon. Friend the Member for Carlisle (Mr. Ron Lewis) because the matter he is to raise is important for his part of the country, so I shall be brief.
I am in agreement with the implication of the Secretary of State's intervention in the speech of my hon. Friend the Member for East Stirlingshire (Mr. Douglas) when he seemed to imply, by the description of a length of speech as potentially one hour, that this should have been a wide-ranging debate on North Sea oil because there is an adequate precedent. This is virtually a one-Clause Bill, just as was the Rolls-Royce Bill and the Government spokesmen and all other speakers in the debate on that Bill found it necessary to argue in detail the background which led to the production of an unusual Bill. That was a one-Clause Bill with wide, sweeping powers which gave a blank cheque to the Government.
I am not convinced that we are merely talking about one and a half harbours or half of Peterhead harbour. My reading of the Bill does not tell me that, but that there is a future commitment in certain parts of Clause 1 for extensive and wide-ranging powers. I have a natural inclination to grant the Secretary of State the powers he seeks, but we are entitled to much more information than the Secretary of State gave in his brief introduction to the Bill. It is not good enough for him to say that we can all read the information in newspaper articles—

Mr. Gordon Campbell: I never said that.

Mr. Sillars: The Secretary of State virtually said that. He chastised one of my hon. Friends on the grounds that much of the information we complained about not having been given was available in articles, and so on.

Mr. Gordon Campbell: That is not what I said. It was suggested that in introducing this short Bill to deal with one particular impediment in one part of Scotland with which we had to deal


quickly, we could have had a long debate on North Sea oil. I said that if that had been the case I could, naturally, have given a long description of everything that is happening, but I did not think that that was what was wanted tonight.

Mr. Sillars: Because the Secretary of State insisted that the information was available to hon. Members from other sources. Someone did a basic article on North Sea oil some time ago. Many people have followed that article and there has been repetition but not much new detailed information, and little from an authoritative source such as the Government. It is not good enough for the Secretary of State glibly to pass by the background which gives rise to the Bill.
The Secretary of State said he could have spoken for an hour, but he chose to speak for much less. Many people in Scotland will regard that choice as reinforcing the suspicion that neither the Government nor the oil companies are providing the necessary information on North Sea oil.
In a leading article in The Scotsman on 13th June Sir William McEwan Younger was said to have hinted—that is the word used by The Scotsman—that there might be deliberate encouragement grossly to underestimate the potential of North Sea oil. That has never been rebutted by Sir William or by anyone close to him.

Mr. Gordon Campbell: The hon. Gentleman will know that doubts are sometimes expressed, as they were from the Front Bench tonight, that North Sea oil might end in 10 or 20 years' time. That is the kind of underestimate which I understand Sir William to be saying should not be made.

Mr. Sillars: No.

Mr. Gordon Campbell: It is partly that. No one can precisely assess the duration, and this is being discussed in public—rightly so.

Mr. Sillars: I have no doubt that Sir William will be making another speech in the near future in which he might take the opportunity to clear up the point.

Mr. Douglas: I have the article here. Does my hon. Friend agree that this is a correct quotation?

…that the potential of the North Sea field had been and still was 'grossly underestimated' and he hinted that the major oil companies might have encouraged this deliberately.
That is a statement which Sir William had an opportunity to rebut. Does my hon. Friend agree that that is the sense of what he said?

Mr. Sillars: Sir William McEwan Younger is a man of many affairs. It follows almost automatically that if there has been an underestimate, say, of the amount of oil in the North Sea, then the estimation of the duration will also have been underestimated. I take that to be the point which Sir William was making, but the Secretary of State obviously does not. The right hon. Gentleman has more opportunities than I for conversations with Sir William. I prefer they keep their row inside the Tory Party.

Dr. Dickson Mabon: The Secretary of State has interrupted my hon. Friend. I should like to read this:
Even today
says Sir William—
official estimates, and I mean Government estimates, seem to be of a possible annual production rate of 75 to 100 million tons by the early 1980s. But many experts consider that double that figure would be a highly conservative estimate for the British sector 'of the field' alone.
I hope my hon. Friend will challenge the Secretary of State on this subject by pointing out that he is responsible for the official Government Estimates.

Mr. Sillars: I noted that intervention. I have no doubt that the Secretary of State has also noted it. It may be that I have a suspicious mind. Perhaps the Secretary of State tried to curtail the discussion on this point after a very short introductory speech because he did not want to open up the argument put forward by Sir William McEwan Younger.

Mr. Gordon Campbell: There was a time only a few months ago when the hon. Member for East Stirlingshire (Mr. Douglas) said I could not make a speech anywhere without speaking of the potential of the North Sea oil industry. I was doing everything in my power to aid it. That was three and a half years ago, before I came into office.
Seven months ago the first announcement was made that North Sea oil had


been discovered in commercial quantities. I made those speeches. I said earlier that hon. Members, I knew, had been following these events. I did not think that a complete history of the whole of the North Sea oil exploration was right. My speeches are usually short.

Mr. Sillars: A lecture to a group of people at Aviemore is no substitute for a detailed statement in the House of Commons, which would then be subject to analysis and debate.
The Secretary of State has considerable support on this subject within Parliament. He has missed a golden opportunity tonight. His performance tonight will lend itself to the widespread belief in Scotland that somehow or other we are being done out of our important potential wealthy natural resource in our country because of Government negligence in handling the giant oil companies which are exploiting the North Sea. That is a widespread belief in Scotland. The right hon. Gentleman's performance helps to reinforce that belief.
This Act does not commit the Secretary of State to expenditure either in 1972 or 1973 or during the years thereafter. We shall have no opportunity to obtain the detailed information we seek on behalf of the people we represent. The right hon. Gentleman's performance does not help to dispel the suspicions—it only reinforces them—that the Secretary of State is somewhat insensitive to Scottish opinion.
There is the growing feeling that, properly handled, this can assist us to climb out of the unemployment depression which the Scottish economy has now settled well into in the middle of 1972.
The Secretary of State must know of the view that it makes doubtful sense for the Government to construct a regional policy based on bribery and persuasion—that is what the present regional policy is—when they seem to ignore wilfully a situation which, sensibly handled, could ensure and guarantee positive results within Scotland in terms of investment and employment. On the one hand, there is a regional policy which hopes to create jobs. However, when we come to North Sea oil we have got a natural resource the management and control of

which is certain to produce results if the Government apply the correct techniques and policies. By that, I mean using the oil revenues in the development areas, the control of production, demanding guarantees about where the oil taken from the North Sea shall be refined inside the United Kingdom, and setting conditions on companies to ensure the stimulation of investment by insisting that they purchase a percentage of their material needs in the development areas, preferably in Scotland.
In the past, Scotland has often suffered as a result of geological conditions. I come from a mining area, and we have to pay a surcharge on our coal because of difficult geological conditions. My constituents see nothing wrong in saying that for once God has been kind to Scotland geologically speaking, and that we should reap some benefit from the North Sea. But, when faced with the choice between hope and something positive, this Government turn their backs on the latter.
While I support the Second Reading of the Bill, I do so with less than enthusiasm. We seem to be getting a piecemeal response from the Government to a potential which, if treated comprehensively, could regenerate the Scottish economy and its employment situation. I hope that this is the last time that the right hon. Gentleman introduces a one-Clause Bill which is in fact an ill-defined Measure.

1.11 a.m.

Mr. Norman Buchan: While we on this side of the House are willing, eager and wanting to give every support we can to help this great industry, it is clear that there is a good deal of dissatisfaction among us about the Bill and its lack of information and about the way in which the Secretary of State introduced it.
I refer to the point made by my hon. Friend the Member for South Ayrshire (Mr. Sillars). The Secretary of State intervened several times to correct my hon. Friend and he made the situation worse each time. He said that he could have spoken for an hour, and we all agree about that.

Mr. Gordon Campbell: On any one aspect.

Mr. Buchan: He said he had not done so not simply because of the lateness of the hour but because hon. Members were following these events and therefore he did not need to. That was the right hon. Gentleman's point. He said we had been reading about it in the Press and, because of that, he did not need to speak about it at any great length.
That was an extraordinary statement for the Secretary of State to make. We are concerned to know whether he is following some of the events and, even more, whether he is leading some of them. That is what we wanted to hear. The right hon. Gentleman should not come forward with this mouse of a Bill and the minimum of introduction on one of the most important industrial developments to have taken place in Scotland.
The right hon. Gentleman feels that he has done well. He has introduced the Bill. He has acted quickly. He sounded almost as though he considered himself the embodiment of the "at a stroke" policy. But in fact he has not moved quickly.
What was even more horrifying was to find, almost by accident, that the right hon. Gentleman moved when he did only because the matter was brought to his notice by the Scottish Council. Other people are telling him what to do. But it is his job. What is he doing about the oil industry if he cannot recognise some of the problems and complications which will arise on the shore installations and has to leave it to those who organise conferences at Aviemore to tell him what he should be doing?
That is why the right hon. Gentleman should have made a longer speech and why we are worried not only that he is not leading but that sometimes is not even following what is going on.

Mr. Gordon Campbell: I said in my opening remarks that it was those connected with North Sea oil developments in this area who had come up against this difficulty and brought it to our notice. That was only a short time ago. I began by saying that. Then I said that it also gave us an opportunity to make this harbour a really good place for the servicing of oil rigs.

Mr. Buchan: This is an extraordinary situation. It means that within the Scottish Office the Secretary of State

has made no effort to set up a special team to look into all the difficulties, possibilities and potentialities of the oil industry. That is what the right hon. Gentleman is suggesting.

Mr. Campbell: We needed legislation.

Mr. Buchan: Yes, legislation was needed, and that is why for the first time we have got something done about oil. Someone has shown up a particular legal problem. The Secretary of State gave no indication that he sees the kind of problems involved in the question of the life potential, and so on. I sympathise with him. I know he came to the House feeling that he was doing rather well for everyone, but that only suggests that he was completely out of touch with Scottish feeling on this issue. We want him to be seized of the importance of this matter to Scotland.
It has been left not to a Minister but to the Chairman of the Scottish Conservative Party, Sir William McEwan Younger, to try to—[HON. MEMBERS: "Oh."] Yes, another reference to Sir William McEwan Younger. I want to correct some of what has been said about this matter. I must apologise to my hon. Friend the Member for Carlisle (Mr. Ron Lewis) who is waiting for the Adjournment debate. We are all sympathetic towards him. He wants to deal with the State Management Scheme. Some may find it curious that Sir William McEwan Younger is so keen to nationalise oil while at the same time trying to denationalise beer.

Dr. Dickson Mabon: That is different. It is his beer.

Mr. Buchan: We should be clear about what Sir William McEwan Younger was saying. The Prime Minister and the Secretary of State keep saying that people did not mean what they said. Sir William McEwan Younger clearly meant it when he said that the Government were not doing well enough. He called for a fundamental change in the Government's approach.
He said:
Time is not on our side.
He is reported to have
urged the Government to jettison yet another free enterprise principle by taking a controlling hand in the exploitation of the North Sea resources.


He admits that he is not a Socialist. That is something for the Chairman of the Tory Party. That is what the Tory Party has come to.
Sir William McEwan Younger said:
I am no Socialist, as some of you know.
He continued:
But it would be quite illogical if a Government, which has departed from its principles—perhaps rightly, probably inevitably—to subsidise industry which may well never be really viable, should largely leave the development of North Sea oil and in particular what is done with that oil and natural gas when extracted, to the complete and unhampered discretion of those who are responsible for its extraction.
It is like a chapter out of "Das Kapital." He is absolutely right. We welcome the conversion. We only wish that we could see a similar response from the Government.
In the face of that clear and correct demand, which has fired so many of the people of Scotland, we get this mouse of a Bill dealing with—possibly dealing, because we are not satisfied about this yet—two harbours in Scotland.
I have a very soft spot for one of the harbours. I played over all the ground around the area which I know extremely well. I have much sympathy with what was said by the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) when he spoke about the amenity aspect. The kind of point made by Sir William McEwan Younger is also the kind of point of some of my hon. Friends, especially my hon. Friend the Member for Stirling and Falkirk Burghs (Mr. Ewing) who referred to the amenity aspect.
If exploitation is to take place, not only do we want a proper return to the community, as of now, but also we want the amenities preserved for the future. We want no more derelict areas on the coast such as we have had in the interior areas of Scotland in the last century. We are right in demanding this. That is implicit in Sir William McEwan Younger's demand.
I was reminded of an old song of which I have only one verse about the situation in 1886—

Mr. Sproat: Will the hon. Member sing it?

Mr. Buchan: No and, since I shall not sing it, it will not scan particularly well. I believe it is correct, although I could not check it with an authoritative source tonight. It goes:
Fan the harbour o' refuge wis first talked aboot
Roonheids and Buchanhaven were fair pitten oot.
Queen Victoria said oor convicts will get better farin'
If they're fed on gweed Buchan tatties an 'Peterheid herrin'.
That is the reason for the harbour of refuge at Peterhead and we think this is what the Bill is about.
This is only a small Bill. It is not only an administrative change but the first direct involvement of the Government with a specific figure—£2 million to £3 million—set down. This is a very large potential investment and a major public investment. The moment it is implemented, the question is raised about public participation in the oil industry. What will follow from the acceptance of public responsibility and public cost? This will be our cost and we have a right to know what public participation will be involved and what public return will come from the exploration. Most people agree that errors have been made in the past. In the initial stages, long before exploration showed any indications of success, the Labour Government left the position open to permit private exploration, except for gas. We recognised from the beginning that gas would be dealt with through the Gas Council.
In the initial stages, however, ways were left open for increasing public participation which have been closed by the Tory Government. The way was open for public participation to give a public return in the way most other countries have done. Britain alone has been giving away the concessions like a succession of Green Shield stamps. At the last bidding one concession went for £21 million. But hundreds or other plots were given for the rental only. In other words hundreds of millions of pounds may have been lost directly to the British people because of the kind of concession granted by the Government.
The question of reversion of these plots to the public is also involved. The amount of land that was given out in these plots was far too big and the wrong


method was adopted. We should have employed the chequer board method. The Government have permitted the companies to return a proportion of the land that they do not wish to continue to explore, instead of the random return system which is employed in other areas.
We should be considering royalty bidding instead of direct cash bidding so that those companies which return more to the people will get a better chance of winning the concession. The granting of the concession should be linked to assurances that the necessary work will be done in Britain. None of this has been written into the Bill. When the Scottish Council comes running the Secretary of State is willing to assist, and in the same way even the present reactionary Government should be ready to insist upon the proper writing in of public involvement and public return from North Sea exploration.
These are the kind of points that are implicit in the Bill. I remind the Secretary of State of the points that have been raised by almost everyone who has spoken. We are not satisfied with the assurances about what the Bill deals with. We have had little proof that only the two harbours mentioned by the Secretary of State are affected. There is dissatisfaction that the opportunity has not been taken to deal with other harbours. This was the point made by my hon. Friend the Member for Greenock (Dr.Dickson Mabon) who referred to the complexity of the Aberdeen situation. My hon. Friend the Member for Caithness and Sutherland (Mr. Maclennan) referred to the small harbours in Orkney and Shetland. The opportunity has been missed to get these matters into the right form.
One would have expected the Government to do that. Doing so would not have delayed the proceedings. In fact it may have helped them, because one thing that is clear is that while we want to do all we can to get the Bill through as quickly as possible, it looks very much as though it will have a very lively Committee stage.

1.26 a.m.

The Under-Secretary of State for Home Affairs and Agriculture, Scottish Office (Mr. Alick Buchanan-Smith): The importance which Scottish Members attach

to North Sea oil development is shown by the fact that so many of them have stayed here for this late debate.
The debate has been useful in some respects and I do not want to appear to be carping in closing it. Some hon. Gentlemen on the Opposition side have given the Bill a general welcome but they have been slightly grudging and carping in some of their comments. The hon. Member for Greenock (Dr. Dickson Mabon) in particular asked some probing questions and I shall endeavour to answer them, just as I shall endeavour to deal with the matters raised by the right hon. Member for Kilmarnock (Mr. Ross) and others.
I thought that the carping comments of the hon. Member for Aberdeen, North (Mr. Robert Hughes) bore no relation to my personal experience of what is going on in Aberdeen, and I am sure that my hon. Friend the Member for Aberdeen, South (Mr. Sproat) will agree with me on that.

Mr. Robert Hughes: rose—

Mr. Buchanan-Smith: I shall not give way at the moment.

Mr. Robert Hughes: rose—

Mr. Deputy Speaker (Mr. E. L. Mallalieu): Order. The Minister is not giving way. The hon. Member for Aberdeen, North (Mr. Robert Hughes) must not persist in trying to intervene.

Mr. Buchanan-Smith: In the first half of his speech the hon. Member for Caithness and Sutherland (Mr. Maclennan) attacked my right hon. Friend for what he was doing, but then he said that the Bill was a good Measure and he welcomed it.
The hon. Member for Renfrew, West (Mr. Buchan) several times called this a mouse of a Bill but then said that it was not just a little Bill. I do not know what kind of mice the hon. Gentleman has in West Renfrew. The hon. Gentleman said that this was the first time something had been done about North Sea oil development in Scotland. He should visit the north-east of Scotland. He should talk to my hon. Friend the Member for Ross and Cromarty (Mr. Gray), my hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) and my hon. Friend the Member for Aberdeen, South. The hon.


Gentleman should discuss the matter with his relatives. Or perhaps he cannot because his family relationships are not all that good. Perhaps they do not want to talk to him because they know that it is not worth while doing so.
Any hon. Member who is actively concerned with the development of North Sea oil knows that what the hon. Gentleman has said is not true. I am sure that the right hon. Member for Orkney and Shetland (Mr. Grimond) will agree with me on that. It is most exciting for those Members who represent constituencies in the north-east and north of Scotland to see how much is being done and how much it is appreciated by those who live in those areas.
Like the right hon. Member for Kilmarnock, I too enjoyed my archeological researches into the Bill. They made interesting reading. I must correct the right hon. Gentleman on one matter. It is not Mrs. Ogston, but Jane Ogston or Mackenzie, and I am sure that my hon. Friend the Member for Aberdeenshire, East knows her successors. I am sure they follow with interest what is going on with these new developments.
In the same way references to Scotch convicts, Scotch prison commissioners and so on make interesting reading.
The main point was the question of the extent of the application of the Bill and precisely why it refers only to the two harbours which my right hon. Friend mentioned, the harbour of refuge at Peterhead and the harbour at Uig. The position is perfectly clear. The Bill applies to harbours that are vested in the Secretary of State by Statute or by order. That is why there is the reference in Clause 1 to those made or maintained by the Secretary of State
by virtue of powers or duties vested in him by any Act or order".
In the case of Peterhead we have a harbour made by the Secretary of State under Statute and in the case of Uig a harbour maintained by him. Other harbours, other fishery harbours and estate harbours elsewhere in the north of Scotland, are either not vested in the Secretary of State, full stop, or are not vested by Statute or order. Some of the others are held simply by the Secretary of State as the proprietor of the estate or whatever

it may be. Therefore, I assure the House that we are absolutely clear that the Bill and the legal definition given in it refer strictly speaking only to the two harbours I have mentioned.

Dr. Dickson Mabon: Is it because of the dangers of hybrid legislation or some other inconvenience to the Secretary of State that line 10 of Clause 1 does not specify the Act and orders involving the two harbours? I could readily understand such an explanation, but if they were specified the Bill would be much clearer.

Mr. Buchanan-Smith: We followed the form we did because of the problems of promoting a Bill that could have been of a hybrid nature if the harbours had been specifically mentioned. When so few harbours are involved, it is right for hon. Members to question why we drafted the Bill as we did.
This begs the question, which I asked my advisers, and which the right hon. Member for Orkney and Shetland raised, of the adequacy of the powers in relation to development at other ports. The right hon. Gentleman raised it particularly with regard to Lerwick, where oil developments are taking place. Several hon. Members have suggested that the Bill should be extended to remove any obstacles that may exist elsewhere. But harbour authorities in general have powers under their local Acts to develop their ports for any commercial purpose.
If in specific cases these powers need to be extended this can be done by order under the Harbours Act, 1964. It is only in the case of the Peterhead harbour of refuge that the harbour authority is specifically limited to maintaining the harbour only for refuge purposes. This is something which cannot be put right under the Harbours Act, which is why we need this Bill. As for the question of whether other harbours, such as Lerwick, can use powers under local Acts, we are prepared to look into this problem with any other local authority or harbour board. This is outside the scope of this Bill. I understand that the Lerwick harbour authority is promoting a provisional order for a new harbour scheme at an estimated cost of more than £1¼ million. I hope that this procedure will not be too much of an obstacle.

Mr. Grimond: The hon. Gentleman is right in saying that the procedure is going through for Lerwick, and there may be problems. I was also referring to the fact that Lerwick has only a certain depth of water and it may be necessary to construct an anchorage or oil terminal in a different part of Shetland, offshore. It is there that certain new problems may arise which will need attention at some point.

Mr. Buchanan-Smith: I am grateful to the right hon. Member. This is certainly something we will take into account. We are prepared to look at this with the interests involved.
One or two hon. Members have suggested that Measures like this are simply plucked out of the air. There have been continuing consultations between ourselves and those involved in industry, whether developing oil companies, servicing companies or bodies such as the Scottish Council. These problems are dealt with as they arise and this Bill is a prime example of that. This ensures that we move forward properly with the exploitation of oil.
The other question of substance raised by the right hon. Member for Kilmarnock and the hon. Member for Greenock dealt with the orders which are obviously important and to which we may well return in Committee. We were asked whether they would be referred to Parliament and when they would be made. In accordance with precedent orders that have to be made amending local Acts are not always subject to presentation to Parliament or to the affirmative or negative procedure. We will certainly consider this and the matter of presentation to Parliament if it is desired. No orders are likely to be needed until constructional works are well advanced. The orders are likely to be concerned only with amending Sections of the 1886 Act dealing with the operating arrangements in the harbour of refuge. Therefore there is no desperate urgency about this.

Dr. Dickson Mabon: I am glad that this is to be looked at. I strongly urge the hon. Gentleman and his right hon. Friend to examine this and confirm that the affirmative procedure is highly desirable. The hon. Gentleman referred to the Harbours Act, 1964. I have had a quick glance at it. Under

Section 14 there is reference to the orders he mentioned, namely harbour revision orders. The harbour revision orders in these cases are all subject to special parliamentary procedure. I will not go into the details, which contrast with what we are discussing.
My second point—if the Under-Secretary cannot answer now, perhaps he will think about it for Committee—is that there is no provision in the figures to sustain these orders. The Under-Secretary must think about this with the Secretary of State. If we have a problem at Aberdeen or at any of the harbours mentioned in the Harbours Act, 1964, and we require a harbour revision order, under what arrangement are we to vote that money? How is that to be achieved? Perhaps this should be looked at again in a wider context.

Mr. Buchanan-Smith: I am grateful to the hon. Gentleman for raising these matters. They are the kind of difficulties to which he referred earlier and which I acknowledge. I should not like to answer those two specific points off the cuff, but they are matters we should look at in Committee. We shall study these matters closely before we reach the Committee stage. I know and appreciate the concern that has given rise to this debate.
I have dealt with the two main points in the Bill and I now turn to the wider implications. The third main area specific to the Bill is the question of finance. That is a matter which has concerned many hon. Members and is one which has been raised generally. I may be trespassing slightly on the Money Resolution which we will be dealing with later. As is indicated in the Financial Memorandum attached to the Bill, however, the expenditure resulting from the Bill is likely to be in three general forms. First, it is likely to involve harbour administration costs which we estimate may increase by up to £50,000 per annum. The present costs are minimal. Repair costs amount to about £1,000 annually. Future costs might also include harbour staff, office expenses and the operation of a harbour vessel.
The second main group of likely expenditure is capital expenditure on the construction of harbour works. If it were found expedient for these works to be undertaken, the Secretary of State might


increase total costs to £3 million in the two-year period 1972–73 and 1973–74. The right hon. Member for Orkney and Shetland asked where this estimate came from. It is the best estimate our technical advisers can make of the costs of the sort of facilities which will be needed and which will be practicable. Of course I at once accept—I do not make any pretence about this—that it is a flexible figure and a figure that may well change as our consultations continue and the various oil developments change or move in certain directions. However—I will return presently to this point which was raised by the hon. Member for Greenock—depending on the extent to which these works could be undertaken by developers, these capital costs could be correspondingly reduced.
The third general category of expenditure could be other increases attributable to expenditure under other Acts. That is a general category. We do not envisage any significant expenditure of that kind. I was asked the question by the right hon. Member for Orkney and Shetland in relation to a Supplementary Estimate in the current year. That will be taken into account.
Relating to some of the other financial aspects that were mentioned, I shall deal first with the question of who might undertake this. Whilst it is possible under the Bill—we are maintaining at this stage a flexible attitude—that if the expenditure is undertaken by the Secretary of State it could amount to the figure in the Bill, it is possible under the powers in the Bill that a developer could be given authority to undertake this.
The hon. Member for Greenock asked what developers we had in mind. All I can say to the hon. Gentleman at this stage is that there are certain commercial negotiations taking place which are of a confidential nature. In relation to those already known publicly. Site Preparations Limited, for example, submitted to Aberdeen County Council on 26th May an application for planning permission. It is also public knowledge that Arunta Ltd. has already obtained planning permission for the construction of warehouse facilities on land which it has leased from the Peterhead Harbour Trustees. So here are two examples of developers taking part in the North Sea oil develop-

ments who could be amongst those who in certain circumstances could undertake some of the developments for which the Bill gives power.

Mr. Buchan: The Arunta company is not involved in the area which we sometimes call "over the Queenie" around the fishing harbour. What is the precise relationship between development there and what is envisaged?

Mr. Buchanan-Smith: I understand that some of the shore installations are scheduled for planning permission, but any developments within the harbour of refuge will be covered by the Bill. A jetty or a pier which impinged on the harbour of refuge would be covered by the Bill. I have a map of the harbour of refuge. I do not know it as well as the hon. Gentleman, who spent his earlier years there, but I am aware of the developments which are proposed for that part.

Mr. Ross: Will the hon. Gentleman make arrangements for the map to be made available to members of the Committee?

Mr. Buchanan-Smith: Yes. It is not a big map but it gives a better understanding of the situation. I willingly give the right hon. Gentleman the assurance that copies of the map will be available to members of the Committee.
Other financial matters were raised by hon. Gentlemen opposite. The hon. Member for Aberdeen, North referred to grants and so on in relation to Aberdeen Harbour. I was disappointed at the tone of some of the hon. Gentleman's remarks, which were completely out of keeping with the response I have met in Aberdeen where a loan of £1½million has been provided for a tidal harbour scheme. I found no resentment in Aberdeen about the loan and the conditions attaching to it. Equally, I found nothing but the warmest welcome for what the Government are doing about the fisheries development there. Therefore, I found the hon. Gentleman's remarks tonight somewhat strange.
In July last year my right hon. Friend the Minister for Transport Industries explained why grants were discontinued. If the Secretary of State undertakes this work, it involves a direct investment by him and it is undertaken on the same


commercial basis we should expect from anywhere else. This was precisely the point raised by my hon. Friend the Member for Aberdeenshire, East when he asked what return we would get on any investment. We expect the return to be at the full commercial rate. The income will be derived from rents for the leases and from harbour dues.

Mr. Robert Hughes: Will the hon. Gentleman accept from me that although the various people interested in the harbour development showed a sense of relief that at last a decision was made to lend the money, there was widespread concern at the way it was done and the fact that the fisheries harbour was to be abandoned in favour of oil. There is a great deal of resentment in the City of Aberdeen about the way the whole matter was handled.

Mr. Buchanan-Smith: We want to get the position clear. The hon. Gentleman is not giving the whole story. I do not want to get involved in a long argument but this is important. If the hon. Gentleman does not understand, the people of Aberdeen do. First, it was the harbour authority itself which decided, on its own initiative, to put back the fisheries harbour development, and I do not argue with its reasons. Now, however, because of the special grants being made available, it has altered that decision. Secondly, loans cannot just be plucked out of the air for general purposes. The hon. Gentleman knows as well as I do and as the harbour authority knows that every loan application must be assessed on commercial viability. The moment the authority put its plan forward, together with its commercial viability assessments, they were dealt with urgently. I am sure that the authority would not deny that.

Mr. Robert Hughes: rose—

Mr. Buchanan-Smith: No, I cannot give way again. The hon. Gentleman has made his speech and I have answered his point.

Mr. Hughes: The hon. Gentleman has not answered the point.

Mr. Deputy Speaker: Order. The hon. Member for Aberdeen, North (Mr. Robert Hughes) must sit down since the Under-Secretary of State is not giving way.

Mr. Buchanan-Smith: I turn to the other financial question raised by the hon. Member for Aberdeen, North, a perfectly fair point about the relationship of the Peterhead development with the development of Aberdeen. I assure him that the Aberdeen tidal harbour scheme received Government approval and support under the Harbours Act only after being strictly scrutinised for its commercial viability. I reassure my hon. Friend the Member for Aberdeen, South that any development proposal at Peterhead will be judged by exactly the same tests. The fact that the Secretary of State is to be the harbour authority there will make no difference to the tests which will be applied to any proposals to be made.

Mr. Douglas: The hon. Gentleman is talking in general terms about tests. I asked about the rate of return involved. Can he answer now or does he prefer to write to me about it?

Mr. Buchanan-Smith: I have detailed notes of many aspects but not of that. I would like to go further into the question of the way these applications are assessed.
My hon. Friend the Member for Aberdeenshire, East raised a number of specific questions relating to the developments at Peterhead and the way they might affect his constituents. He is right to raise the matter because the developments could have a major effect not only on the economy but on the whole environment of the area. Proposals for the fishing harbour development are under consideration and we expect to be able to give an answer in the not too distant future, but there are one or two difficulties which must be cleared out of the way first. In particular there is a slight problem over the statutory powers of the harbour trustees in relation to the North Harbour which must be settled first. They are going into it now with their legal advisers. We recognise the case for an extension at Peterhead, but the scheme they are putting forward is for the biggest inshore fishing harbour development ever to be presented in Scotland. It is enormous in size—indeed, it is quite unique in its size—and it must be considered alongside many other schemes from other areas. I assure my hon. Friend that we are seized of the


urgency with which harbour trustees view their own application.
On the question of safeguards for fisheries, the Bill does not affect the fishing harbour, and the right of access through the harbour of refuge is not affected. Fishing interests will be safeguarded. I am glad to be able to give my hon. Friend that assurance.
The hon. Member for Stirling and Falkirk Burghs (Mr. Ewing) and my hon. Friend both referred to the necessity not to leave behind modern industrial development the kind of thing from which the present generation suffers because of past industrial development, particularly in central Scotland. We appreciate the need to preserve amenity. It is an important element which we must bear in mind in discussions with potential developers and with Aberdeen County Council, the planning authority. I know that that council is very much aware of the issues involved, because this is not simply an industrial development but a community development, as my hon. Friend said, because there is a community in Peter-head and this must be recognised in any industrial and commercial development.
I have been encouraged by what has happened already, which is known to my hon. Friend. At one level there have been talks with the education authority and the town council about making the swimming pool at the new academy a general civic facility. That is one example of how the authorities involved in Peterhead are making sure that the amenities are preserved. From the next county, I know how Aberdeen planning authority works and that it is alive to what is involved.
I apologise for speaking at some length but a number of right hon. and hon. Members have spoken at some length. It shows how important is this issue. The Bill may be narrow in referring only to Peterhead but in another sense, in the way it refers to people affected, it sets a certain pattern. As my right hon. Friend said at the beginning, the Bill demonstrates that for the people of Peterhead, for the oil companies and development companies and for the finance houses which are backing some of the developments and which welcome the Bill, it is proof that the Government are on their toes in oil

development and are ready to act where action is needed.

Question put and agreed to.

Bill accordingly read a Second Time.

Bill committed to a Standing Committee, pursuant to Standing Order No. 40 (Committal of Bills).

Orders of the Day — HARBOURS DEVELOPMENT (SCOTLAND) [MONEY]

Queen's Recommendation having been signified—

Resolved,
That, for the purpose of any Act of the present Session to enable the Secretary of State to develop, maintain and manage, or authorise other persons so to do, harbours in Scotland made or maintained by him for any purpose; and for purposes connected with the matters aforesaid, it is expedient to authorise—

(1) the payment out of moneys provided by Parliament of—

(a) any expenditure incurred by the Secretary of State in developing, maintaining or managing such harbours as afore said or in connection therewith;
(b) any administrative expenses incurred by the Secretary of State under the said Act;
(c) any increases attributable to the said Act in the sums payable out of moneys provided by Parliament under any other Act;
(2) the payment into the Consolidated Fund of any sums falling to be so paid in consequence of any of the provisions of the said Act of this Session, or in con sequence of the amendment of any statutory provision by an order made thereunder.—[Mr. Buchanan-Smith.]

Orders of the Day — COMPANIES (FLOATING CHARGES AND RECEIVERS) (SCOTLAND) BILL [Lords].

Order for Second Reading read.

Ordered,
That the Bill be referred to the Scottish Grand Committee.—[Mr. Buchanan-Smith.]

Orders of the Day — ADJOURNMENT

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Weatherill.]

CARLISLE AND DISTRICT STATE MANAGEMENT SCHEME

2.0 a.m.

Mr. Ron Lewis: After the interesting debate on Scottish affairs it is only right that we should move to an important city this side of the Scottish border to discuss briefly the rape by the Government of the successful Carlisle and District State Management Scheme.
Since last we discussed the scheme there have been Government changes, and I welcome and congratulate the hon. Member for Cambridge (Mr. Lane) on his appointment. My only regret is that he has been thrown in at the deep end to reply to the debate. I am fortified by the presence of my hon. Friend the Member for Bristol, South (Mr. Michael Cocks) who shared our experiences in Committee on the Licensing (Abolition of State Management) Bill.
In January, 1971, the Home Secretary sent to Members of Parliament affected by the scheme a letter to the effect that the Government intended to bring forward legislation which would be introduced very soon. He said that the process of sale would begin shortly after the Bill was enacted, and he expected the scheme to continue for the greater part of the year. In May of last year we had the Third Reading of the Bill and not long afterwards Royal Assent was given.
Since then there has been a great deal of speculation about what is happening and nobody in Carlisle or, as far as I know, anywhere else can get any information about how the sale is proceeding, except that a few houses outside Carlisle have been offered to existing tenants.
In January, 1972, a year after the Home Secretary sent out his circular, and giving the Home Office ample time to set the machinery in motion, I sent a letter to Storey, Sons and Parker of Middles rough who are dealing with the sale, asking for information on how the sale was going because I could not get any information inside this Chamber although we were promised in Committee that statements would be made from time to time. I received what I thought was a cheeky reply from Storey, Sons and Parker, who I have since learnt are sympathetic to the Tory Party, containing this passage:
Our instructions are that we have no authority to give you anything in the nature

of a progress report on the state of negotiations.
Who gave Storey, Sons and Parker the instruction that the Member of Parliament for the city should not be told how the firm was raping the scheme in Carlisle?
I have not been able to get any information from any Government Department other than evasive replies to Questions I have raised in Parliament. There is great speculation in Carlisle about what is happening. It appears to be clouded with secrecy and full of mystery. It is now time that the Government came clean with the House, with the people of Carlisle and with the country and gave us an up-to-date statement of the position instead of the generalisations we get by way of answers to Questions.
My right hon. Friend the Member for Workington (Mr. Peart), my hon. Friend the Member for White haven (Dr. John A. Cunningham) and I, not satisfied because we could not get any information, asked for an interview with the Home Secretary. That interview took place. The Home Secretary told us he expected to make a detailed statement sometime before Easter on the process of the sale. It is now midsummer. We still cannot obtain any information. My impression is that the Home Secretary of still dawdling.
The time has now arrived when we should have some information. Everybody is wondering what is happening. People wonder what is to happen to them. Civil servants, who have served the scheme, are now in fear of redundancy. Others fear another move because of the expense involved.
During the course of the Committee stage of the Bill we tried to get an assurance from the Government about the safeguarding of jobs. They would not give it. Even now the brewery workers and all the others still have not received any notification. Many of them have had an opportunity of another job. They dare not leave because, if they did, they would lose their redundancy pay. When will the managers of the public houses be allowed to know anything concerning their future?
One is deeply conscious that even the brewery companies have a number of men under training. What guarantee is there that the managers will be assured of their future? There is now a great


deal of discontent among the managers and staff because no progress appears to have been made in reply to the case submitted in February for an increase in their pay in order to put them in the picture with the private trade. Meanwhile, everyone engaged in the scheme is kept in the limbo of uncertainty. The longer it continues, the worse the position becomes.
Can the Minister give some kind of assurance about the number of people now employed in the scheme who will eventually become redundant? We hear a great deal of talk from the Government benches about the consumer. Can the Minister give the people of Carlisle an assurance that when the sale is complete the consumers will have their beer prices safeguarded? Will they still be able to buy their beer at the cheap rates they now enjoy?
The tragedy is that the only information we can get comes from one of the mouthpieces of the local Tory Party in his capacity as chairman of the advisory scheme. According to the Cumberland News of 16th June he said:
There have been inevitable delays in preparation for sale of the main properties, but tender documents now being prepared should be ready for issue in six to eight weeks and the basis on which tenders are being invited will be announced before the Summer recess at the end of August. This will give prospective buyers two or three months to consider the lots on offer. I expect the properties to change hands in six to eight months' time.
Surely a statement of that nature should have been made in this House by the Home Secretary. The Government are bypassing Parliament.
Many people have wanted to buy their properties. In each case the answer has been that it is not possible since the property is part of a lot which has to be sold. It is crying shame that people who want to buy properties which have been in their families in some cases for 50 years have been brushed aside in this way and told that their properties have to go with the scheme. They have to go with the scheme because property values have risen astronomically since the present Government came to power and especially since the Licensing (Abolition of State Management) Act became law about 12 months ago.
Will the Minister now order and set in motion the reassessment of the property of the Carlisle and District State Management Scheme, bearing in mind that prices have increased since the Act became law? Or is the property to go to the brewer friends of right hon. and hon. Gentlemen on the Government side at give-away prices as a reward to those who gave handsomely to Tory Party funds and, as far as I know, are still contributing?
I say that not only my people in Carlisle but the whole nation have a right to answers to this and some of the other questions that I have posed.

2.15 a.m.

The Under-Secretary of State for the Home Department (Mr. David Lane): I thank the hon. Member for Carlisle (Mr. Ron Lewis) for the kind personal remarks with which he began the debate. Far from being conscious of being thrown in at the deep end, and although I do not know Carlisle very well yet, I regard it is a great privilege to have some responsibility for carrying on the next stage of this story.
A great deal of what the hon. Member said seems, from my knowledge of the matter, to be nearer to fantasy than to fact. I shall do what I can in the next quarter of an hour to give the hon. Member and the House a straightforward account about the stage we have reached. I am glad to have the opportunity to do so.
I regret the exaggerated tone of some of what the hon. Member said. I take some of those points straight away. I am sorry the hon. Member felt that he received a brush-off when he wrote to Storey, Sons and Parker. If he has any further questions on the progress being made or the stage reached, I hope he will get in touch with me. I will then try to give him any information I can.
The hon. Member did rather less than justice to the replies which my hon. and learned Friend the Minister of State gave him at various stages during the last few months, and which I have been reading. I think they were as informative as they could be. There is no question of the Government trying to bypass Parliament. There is no mystery about this. There is no justification for the hon. Member's implied charges of inaction by the Government.
Before I deal with the whole range of questions raised by the hon. Member about the progress with the sale, I refer to one other thing not directly related to that: that is, the question of the pay claim which the hon. Member mentioned. I appreciate that this was made some time ago. All I can tell the hon. Member is that the claim is under urgent consideration and we shall be in touch with the union again as soon as we can. I regret that there is any further delay in this, but we shall be in touch with the union very shortly.
I hope I shall cover most of the hon. Member's points as I summarise the position we have now reached over the sale of these State management properties. This is not the occasion to go over the ground of past debates on what I think the hon. Member vividly called "the rape of the trade in Carlisle". This was very fully discussed during the debates on the Bill, in which I am sorry that I was unable to take part.

Mr. Michael Cocks: It is too painful.

Mr. Lane: There is nothing painful about it. I should be happy to have those debates again. We are much more concerned with the present situation and the legitimate anxieties and interests of the people of Carlisle who are concerned.
As the House knows, the Act requires the Secretary of State to dispose of State management property on such terms as appear to him expedient in the public interest, and it does not lay down any time scale. As the hon. Member will recall, when the Bill was in Committee the Government said that we thought completion might take a year from the passing of the Bill, which was on 27th July, 1971. Within that year we shall have substantially completed the sale of about 130 properties. These comprise 34 small public houses and 73 shops and private houses, all to the tenant or occupier, and a further 20 or so properties to local authorities. This is fair progress and compares quite well with what has been done in Scotland, where of course the number of properties is very much smaller.
The hon. Member raised in passing the question of the entitlement of tenants

to buy their public houses. But it has been said on several previous occasions—and I must repeat it—that we feel we cannot equitably sell to all tenants without selling also to all managers, which would mean selling all the properties separately. In the view of our agents, this would mean that we would realise substantially less than if we grouped properties together for sale. We did not feel justified in doing this at the taxpayers' expense.
I understand that the principles we intend to follow in the sale were fully explained to the Standing Committee. We need to get the maximum value in realisations of the properties and at the same time to avoid any risk of local monopoly. I stress yet again, as was stressed in Committee, that we are following the advice of our professional advisers who are specialists in dealing with licensed premises. We were pressed in Committee to make sure that this selling operation would be done, as it were, at arm's length, from the Home Office or the Treasury. We therefore appointed independent agents. We are sticking to those proposals and we must naturally give weight to their advice.
What has taken longer than we expected, and I make no attempt to disguise this, is the sale of the remaining 125 properties—the larger public houses, the hotels and brewery—which are to be sold, in accordance with the advice from our professional agents, by public tender. When so many properties are involved this is a very complex undertaking. The tender documents have to be prepared with great care and they must include the detailed particulars and conditions relating to each property that a potential purchaser has the right to know.
That is because under this procedure of public tender there is no stage at which there is a sale subject to contract. The acceptance of a tender constitutes a contract with the buyer. We have therefore had to scrutinise very carefully the deeds and records, carry out considerable research in Carlisle and draw up detailed plans, and this has taken a long time to carry through. But it is largely for these technical and entirely creditable reasons and because we wish to make a thorough job of the offers of sale that the details of the sale have not yet been announced.
I understand that this is a matter of great local interest but we have thought it right to follow normal commercial practice in not announcing the detailed basis on which tenders are to be invited until the tender documents are ready for issue. As I said on 15th June in answer to a Question from the hon. Member—and I thought from what he said this evening that he had overlooked that this was announced in the House two weeks ago—these documents are with the printer and should be ready for issue in the first half of August.
An announcement giving details of the sale will be made before the Summer Recess and we hope to be able to announce decisions on the tenders in the autumn. The remaining properties will be changing hands in six to eight months' time from now and the House will be kept informed at every stage.

Mr. Ron Lewis: We have been told about that by the chairman of the advisory committee. Will the Under-Secretary tell us something about the value? We want to know something new.

Mr. Lane: I have repeated what I announced to the hon. Gentleman in a written answer less than a fortnight ago, whatever may have been said elsewhere. Because we are doing this in a thorough and methodical way I cannot give more details tonight, but I have tried to indicate how we will proceed over the next few weeks and months and we shall keep the House informed at the time that we think it right to say more.

Mr. Lewis: What about a new revaluation?

Mr. Lane: I cannot say more about that this evening. That must await another occasion. The suggestion has been made that the House should be informed of the outcome of sale before any commitment is entered into. As my hon. and learned Friend the Minister of State explained on 25th April, however, this would not be appropriate under the public tender procedure. As we promised the Standing Committee, we shall inform the House of the outcome of sale—that is to say, the names of the buyers and the price for each property or group of properties, together with the independent valuations which we received before the sale. That we shall do in due course.
The other main point that I want to touch upon—it was rightly mentioned by the hon. Gentleman—is the future of the State management staff. The hon. Gentleman knows, and I hope acknowledges, that this is something to which we attach great importance, as we must. There have been regular visits to Carlisle by members of the Establishment Department of the Home Office and discussions have been held with the associations and unions concerned and with individual members of the staff. We are in close touch with Government Departments which can offer posts in the Carlisle area and we have already made satisfactory arrangements for a number of staff. In particular, special arrangements are being made, which I believe will be helpful, with Her Majesty's Customs and Excise in connection with the opening of its new local offices in Carlisle, and particularly with the development of offices for dealing with value added tax.
Those staff for whom no alternative employment can be found will receive appropriate compensation in accordance with the recent agreement made with the Staff Side of the National Whitley Council covering redundancy situations. Under the agreement we have had to issue formal notices of termination of employment to some staff, but we have made it clear that we shall be prepared to continue this employment as long as the jobs exist.
I know that the delay in announcing details of the sale of the larger properties has caused speculation in Carlisle and uncertainty among the staff about how long they will remain in Government service. I regret this and I hope that tonight's debate has been useful in clearing the air and in affording me an opportunity to make this brief progress report on the whole situation.

Mr. Michael Cocks: Will the people who eventually buy their properties have to pay more because of the Government's procrastination? If the matter had been cleared up some time ago, would they not have paid substantially less than they will have to pay when the matter is settled?

Mr. Lane: I cannot go further than the general terms in which I have spoken tonight beyond saying that the procedure


of public tender will ensure that we get the true market price for these properties. That seems to me to be the way in which any Government should proceed, and I must refute the charge that there has been undue delay in carrying this operation through. It has been necessary to do this thoroughly in the way I have tried to explain.
I assure both hon. Gentlemen who have stayed up late for this debate that we shall press on with the remaining stages

of the sale with the greatest possible urgency until the matter is settled.

Mr. Ron Lewis: What about my constituents, the consumers, in whom hon. Gentlemen on the Government side are supposed to be so interested?

Mr. Lane: I hope they will continue to enjoy the beer which they drink in Carlisle.

Question put and agreed to.

Adjourned accordingly at twenty-nine minutes past Two o'clock